IMF: social welfare benefits 'too high'

bbsrs · 19-07-2012 11:37PM

Why don't we have a social welfare system that in the event of being made redundant you get unemployment benefit proportional to what you paid in similar to the French system?

Farmer Pudsey · 20-07-2012 02:06AM

Everbody forgets the issue the trioka want us to reduce our budget deficit by about 4 billion this year. Where do we get it from any of the low hanging fruit left is well hidden. Capital expenditure has been well cut back so little room there.

Local taxes will raise some but again it will be the coping classes that pay and it will effect couples on 30-100k the most. Taxes on fuel will again effect workers the most and higher tax in the form of cuts to allowances and bands willl again hit the 30-100K bracket. Child benifit means testing will hit the 60-100k if serious money is to be saved.

But I am afraid that this is what will happen the college fees will be raised, fuel will be hit, local taxes in the form of increasing the houshold charge and the imposition of a water charge( in the case of the water charge there will have to be a reduction for the unemployed can you see it coming).

When people work hard they expect to see some benifit and at present this is not the case. Some people thing that government create jobs they do not rather they create the situtation where it pays people to work and they make it profitable for employers to take on staff and do not impose unnecessary costs on them.

An intresting situtation I came accross recently a person that is self employed applied for a maintenance job was at the interview employer was intrested in his skill set however on learning that he was not on benifit would not employ him as he would not get the reduced PRSI. This man is finding it hard to make ends meet as he has a child going to college and is considering he may have to emigrate to find work while his child goes through college. So here we have a situtation where gov Intervention affect some people disportionally.

The reality is that the welfare rates in this country are unsustainable, the cost of pay in the HSE is effecting the level of heath service we have. The cost of the public service is pulling down the rest of the economy. If we have to cut 4 billion where do we cut it sombody has to suffer why is it always the coping class

Count Dooku · 20-07-2012 07:29AM

Nody wrote: »

Beyond the issues raised above the simple fact is that the dole receipent would sell them on at a slight discount to get cash to buy it anyway.

those who wanted to get booze, will get less of it, others won't be affected

IBEC is suggesting something similar for different reasons

http://www.ibec.ie/IBEC/DFB.nsf/vPages/Economics_and_taxation~Key_issues~action-plan-for-recovery---50-ideas-to-drive-growth-17-07-2012/$file/IBEC%20Action%20Plan%20for%20Recovery.pdf

EchoO · 20-07-2012 09:56AM

Farmer Pudsey wrote: »

Everbody forgets the issue the trioka want us to reduce our budget deficit by about 4 billion this year. Where do we get it from any of the low hanging fruit left is well hidden. Capital expenditure has been well cut back so little room there.

A total of €3.5 billion in savings are planned; €1.25 billion in new taxes and €2.25 billion in cuts. The IMF has stated that upwards of 500 million in cuts is going to come from the social protection budget.

Farmer Pudsey · 20-07-2012 08:56PM

Count Dooku wrote: »

those who wanted to get booze, will get less of it, others won't be affected

IBEC is suggesting something similar for different reasons

http://www.ibec.ie/IBEC/DFB.nsf/vPages/Economics_and_taxation~Key_issues~action-plan-for-recovery---50-ideas-to-drive-growth-17-07-2012/$file/IBEC%20Action%20Plan%20for%20Recovery.pdf[/QUOTE]

The reason that people put CA into saving accounts is that it is the easyist money to do it with. You get it once a month so if you need an account for back to school funds for uniforms or a Christmass Fund or for clothes,ESB, Phone then it makes commonsence to use an income source that you have the same amount going into. People who are prudent will always save,if you get two families with two childern both will spend money differently

Some families may use the money to make the repayments for a car, this dosen't mean that they use the CA to buy a car it means that is the way they budget they may save from there wages into a work credit Union like teachers or guards.

Another couple may pay for the car out of there wages into the local credit union and use the CA to save for the family holiday, Christmass and school funds.

Another family with one child may use it to go a resturant once a month. Just because it is saved dosen't mean it has no economic impact

Tea drinker · 20-07-2012 09:54PM

KyussBishop wrote: »

I find their 'encourage people back to work' line a bit disingenuous, seeing as the lack of jobs is plainly obvious.
Regardless, some welfare is high and in need of reduction, and there does seem to be a need for reform in many areas of welfare.

One thing in particular though, is (separate to welfare) the property and rental market needs some serious reform, to get the prices down (and thus reduce rent supplement);
I don't know enough in that area to say what kind of reform is needed, but the prices are still ridiculous, and the general cost of living factors in too and needs reduction.

As for our wider economic recovery:
Balancing the budget gradually will only get us so far, and will shrink our economy along the way as well (causing some degree of a negative feedback loop, requiring more cuts); need to look at wider ranging policies of debt restructuring/writedowns, and then probably some stimulus (considered carefully, in the right areas) if our reduced debt allows.

I take your point about the unavailability of work right now but the unfortunate fact is some people will not be encouraged off the dole unless there is an increased level of discomfort. It would be ideal if the dole could have been chopped when we had close to 100% employment but .. we are where we are ;-)
The plus side of cuts is that these are reducing tax increases that will be hoisted on the truly most vulnerable of society, the PAYE workers.
There's going to be an increasing level of discomfort there as well.
The government won't do anything to reduce housing costs - we are tied to the property market, and with houses more expensive than ever they will still keep pressure to hold the prices up to protect our/their banks.OK they might fiddle on the rent allowance a *little* bit.
We probably have the most expensive houses in the world when you consider the a huge amount of the almost 70 billion is to cover housing bets.

bbam wrote: »

Lots calling for these cuts seem to forget that most are ordinary hard working families who have paid their dues through the years. It's essentially saying "cut their modest payments so my tax isn't increased. "

.

I fully expect nother tax increase, but I fully expect cuts to SW too. Maybe in 5 years we migh see the question of quango's, legal proffession and medical proffession being opened up. Only nother 10years till we can *cough* ahem hawwwwwwk *cough* *cough* talk about *cough* politicians wages.

KyussBishop · 20-07-2012 10:24PM

Tea drinker wrote:

I take your point about the unavailability of work right now but the unfortunate fact is some people will not be encouraged off the dole unless there is an increased level of discomfort.

That's fine, and I'm all for that, just not where it risks imposing collective punishment on those genuinely unable to get work.

Tea drinker wrote:

The government won't do anything to reduce housing costs - we are tied to the property market, and with houses more expensive than ever they will still keep pressure to hold the prices up to protect our/their banks.OK they might fiddle on the rent allowance a *little* bit.
We probably have the most expensive houses in the world when you consider the a huge amount of the almost 70 billion is to cover housing bets.

That's sadly true in all probability, but something has to be done to bring some sense back to the housing market, and bring down the cost of living too; it's not just a matter of protecting debt now, but of protecting the future of the current (and next) generation that will be needing to buy a place to live.

Bankruptcy laws need to be made more manageable, and there need to be sizable debt writedowns for private debt; if our national debt gets a writedown, a subsequent writedown of private debt needs to be one of the first ports of call in my opinion. That would do a lot to ease pressure on people, and to help economic recovery as general demand increases; got to get out of the ball and chain of debt deflation.

In either case, there's no excuse for rent staying so high, as I doubt most of that is propping up mortgages (and it's certainly a big draw on benefits); would be interesting to see a full and proper analysis of the housing market, and why it's so expensive (beyond the initial potential reasons of cheap credit years ago).

Suryavarman · 20-07-2012 10:33PM

bbsrs wrote: »

Why don't we have a social welfare system that in the event of being made redundant you get unemployment benefit proportional to what you paid in similar to the French system?

It'll probably only make the situation worse. Instead of just disincentivising low skill workers from taking a job, it would disincentivise high skill workers as well.

golden lane · 20-07-2012 10:39PM

ireland does not have to borrow money off the imf.........but it is the cheapest way, the reason it is cheap is because it has some say in the way it gets paid back....

if the country borrows from other sources, with high interest payments there will be less money to pay for its needs.....

Boskowski · 20-07-2012 11:23PM

Count Dooku wrote: »

those who wanted to get booze, will get less of it, others won't be affected

IBEC is suggesting something similar for different reasons

http://www.ibec.ie/IBEC/DFB.nsf/vPages/Economics_and_taxation~Key_issues~action-plan-for-recovery---50-ideas-to-drive-growth-17-07-2012/$file/IBEC%20Action%20Plan%20for%20Recovery.pdf

Well then you just put money from your wages into the savings account equivalent to the child benefit amount and use the card in Tescos instead of using cash. Same outcome.

Boskowski · 20-07-2012 11:30PM

KyussBishop wrote: »

I find their 'encourage people back to work' line a bit disingenuous, seeing as the lack of jobs is plainly obvious.

How about that Irish Times article last week on the 200 new Londis jobs in Dublin where they had queues around the block and 2.5% of all applicants (I kid you not) were Irish. And those weren't even minimum wage jobs, a little over.

I can dig it up if I have to.

Fact is there are jobs just not jobs people are prepared to take yet. And I wouldn't fault them, I'd be the same. If I had the choice of getting >€400 per week in the hand for a 40 hour week in Londis or €188 per week (plus whatever else I may qualify for) while learning the guitar or working on my golf game I'd say I'd chose the latter myself unless I really really needed the extra money.

I'm not begrudging anyone their dole and I know the (hopefully) vast majority of welfare receivers deserve it and need it really really badly, but the main problem is that the gap between the welfare rates and lower income jobs out there is simply to small.

I have no idea for an easy solution, previous governments have got us into that discrepancy with mad inflation and mad rises and whatnot and now its not easily reversible, but the fact remains we have a problem.

djpbarry · 20-07-2012 11:37PM

KyussBishop wrote: »

In either case, there's no excuse for rent staying so high...

Relative to where? From where I'm sitting, rents in Ireland are pretty damn low.

n97 mini · 20-07-2012 11:49PM

djpbarry wrote: »

Relative to where? From where I'm sitting, rents in Ireland are pretty damn low.

4-bed house in Leitrim will set you back €400 a month. Not bad.
4-bed house in parts of South Dublin will set you back €1800 a month. That's a lot.

woodoo · 21-07-2012 12:03AM

Boskowski wrote: »

How about that Irish Times article last week on the 200 new Londis jobs in Dublin where they had queues around the block and 2.5% of all applicants (I kid you not) were Irish. And those weren't even minimum wage jobs, a little over.

Everyone should print off that article and send it to Joan Burton. It is as clear as day that people aren't taking certain jobs because life on the dole is better.

200 jobs and only 5 Irish applicants :eek:

KyussBishop · 21-07-2012 12:12AM

Boskowski wrote: »

How about that Irish Times article last week on the 200 new Londis jobs in Dublin where they had queues around the block and 2.5% of all applicants (I kid you not) were Irish. And those weren't even minimum wage jobs, a little over.

I can dig it up if I have to.

Fact is there are jobs just not jobs people are prepared to take yet. And I wouldn't fault them, I'd be the same. If I had the choice of getting >€400 per week in the hand for a 40 hour week in Londis or €188 per week (plus whatever else I may qualify for) while learning the guitar or working on my golf game I'd say I'd chose the latter myself unless I really really needed the extra money.

I'm not begrudging anyone their dole and I know the (hopefully) vast majority of welfare receivers deserve it and need it really really badly, but the main problem is that the gap between the welfare rates and lower income jobs out there is simply to small.

I have no idea for an easy solution, previous governments have got us into that discrepancy with mad inflation and mad rises and whatnot and now its not easily reversible, but the fact remains we have a problem.

I'm not against reduction of the dole (it is too high), but there is very clearly a lack of jobs.

Some jobs being available, does not mean there are not a lack of jobs; there are not nearly enough jobs available to employ everyone that is unemployed at the moment.

KyussBishop · 21-07-2012 12:17AM

djpbarry wrote: »

Relative to where? From where I'm sitting, rents in Ireland are pretty damn low.

As n97 mini points out, in Dublin they are pretty high; costs of buying a house in general, are also still very high.

Boskowski · 21-07-2012 12:59AM

KyussBishop wrote: »

I'm not against reduction of the dole (it is too high), but there is very clearly a lack of jobs.

Some jobs being available, does not mean there are not a lack of jobs; there are not nearly enough jobs available to employ everyone that is unemployed at the moment.

Actually I have to paddle back a bit. I was reading a comment on that thing last week but upon further investigation it shows the original Irish Times article is from 2009 which escaped my attention at the time.

http://www.irishtimes.com/newspaper/opinion/2009/0427/1224245443843.html

Didn't mean to misinform and I think the point is still the same, the gap is too small. Apologies all the same.

woodoo · 21-07-2012 01:05AM

Boskowski wrote: »

Actually I have to paddle back a bit. I was reading a comment on that thing last week but upon further investigation it shows the original Irish Times article is from 2009 which escaped my attention at the time.

http://www.irishtimes.com/newspaper/opinion/2009/0427/1224245443843.html

Didn't mean to misinform and I think the point is still the same, the gap is too small. Apologies all the same.

Permaban

K-9 · 21-07-2012 01:11AM

Boskowski wrote: »

Actually I have to paddle back a bit. I was reading a comment on that thing last week but upon further investigation it shows the original Irish Times article is from 2009 which escaped my attention at the time.

http://www.irishtimes.com/newspaper/opinion/2009/0427/1224245443843.html

Didn't mean to misinform and I think the point is still the same, the gap is too small. Apologies all the same.

I thought of that article when you posted. I don't think there would be that level of complacency now, a good few have had a wake up call over the last few years and it probably isn't a bad thing.

Count Dooku · 21-07-2012 08:09AM

Boskowski wrote: »

Well then you just put money from your wages into the savings account equivalent to the child benefit amount and use the card in Tescos instead of using cash. Same outcome.

only for those who didn't leave country

KyussBishop · 21-07-2012 04:20PM

Oh yea, forgot about this; relevant to the thread, recent resignation of IMF economic advisor, where he heavily criticizes the IMF on the way out:
http://www.nakedcapitalism.com/2012/07/departing-imf-economist-blasts-fund.html
http://www.scribd.com/doc/100639398/Peter-Doyle-Resignation-Letter

AlekSmart · 22-07-2012 01:12AM

KyussBishop wrote: »

As n97 mini points out, in Dublin they are pretty high; costs of buying a house in general, are also still very high.

Not high enough IMO.

The true cost of establishing oneself as a Property Owner,both financially and socially really has never been on the Irish radar screen at all.

Instead,successive Governments since the early 1960's quite deliberately propagated the myth that Property Ownership was a painless,cost-free exercise available to all and sundry,with the State itself even prepared to subsidise it...:rolleyes:

We now know,all to clearly,that this universal property Ownership comes with a substantial cost element included,which in truth means Property Ownership is not an affordable proposition for a great many people.....something which many other European peoples have accepted for centuries.....;)

However,replacing Property Ownership with a strong and clearly regulated Property Rental market remains markedly absent from the "Programmes" of our present Government,who instead continue to foist the notion upon us that the Property "Market" can be restarted...

KyussBishop · 22-07-2012 02:35AM

Eh? Why should property cost even more? Government do not subsidize property here from what I can tell.

Owning a house is not an exorbitant luxury for gods sake, it should be achievable by anyone with a regular income, and judging largely by the material and construction costs, that's not an unreasonable target.

waltermc · 22-07-2012 12:04PM

Social welfare benefits are generous for those who get JSB or JSA along with child benefit and rent allowance. The weflare bill can be reduced significantly if the wealthy dont get child benefit and medical cards

Cutting JSA and JSB wont help get people back to work if they cant earn enough to pay their bills or actually find a job

How can cutting it encourage people to work when my son has applied to hundreds of jobs in this country and abroad and cant get anything. €188 a week is not high. If it was set in accordance to a percentage of what you earned from your previous job it would be much higher.

Take medical cards away from the wealthy and take child benefit away from them aswell as they can afford to care for their kids without state help.

Ther are people in this country who dont work at all and get their income from the state as they believe they dont have to work. Target these people and actually get proper jobs for people who want to get off the dole.

Social welfare rates should have been cut years ago when things were great. The government are to blame for the mess we are in and all they want to do is heap more misery on people.

Its well known that you have people flying in every week to collect their payments and leave again. I have heard it from a source who knows it being done by alot of foreign nationals.

I also want to point out why are the vulnerable being targeted. Will the IMF target the politicians and civil servants?

I am sick of people thinking those on the dole don't want to get off it. I come across alot of people who want off it and cant get work.

If people have to choose between paying a property tax and feeding their kids what do you think they would choose?

djpbarry · 22-07-2012 12:24PM

n97 mini wrote: »

4-bed house in Leitrim will set you back €400 a month. Not bad.
4-bed house in parts of South Dublin will set you back €1800 a month. That's a lot.

Relative to Leitrim? Isn't that a bit of a silly comparison?

waltermc · 22-07-2012 01:13PM

I meant to add to my post that the government should work out why social welfare benefits are so high and then tackle the reason why. The cost of renting houses is crazy in Dublin and rent allowance could be reduced if rent was reduced.

djpbarry · 22-07-2012 01:40PM

waltermc wrote: »

The cost of renting houses is crazy in Dublin...

Relative to where?

Lads, saying that the cost of something is high is completely meaningless unless you provide a frame of reference.

Now, looking at the latest Daft rental report, a 2-bed property in the most expensive part of Dublin, Dublin 4, will set you back an average of €1,372 per month. By comparison, a 2-bed property where I live in London, which is not a particularly expensive neighbourhood (SW4), will set you back in the region of £1,700 per month.

So, can people please explain to me why they think rents in Dublin are "crazy"?

EchoO · 22-07-2012 02:04PM

While some of our individual benefits may be higher than other EU countries, it would appear that our overall spending on social protection is very low by European standards. Ireland comes 12th out of 14 in expenditure on social protection as a percentage of national income.

http://www.ronanlyons.com/2010/11/02/where-should-ireland-cut-its-public-spending-thoughts-for-budget-2011-ii/

waltermc · 22-07-2012 02:11PM

Boskowski wrote: »

How about that Irish Times article last week on the 200 new Londis jobs in Dublin where they had queues around the block and 2.5% of all applicants (I kid you not) were Irish. And those weren't even minimum wage jobs, a little over.

I can dig it up if I have to.

Fact is there are jobs just not jobs people are prepared to take yet. And I wouldn't fault them, I'd be the same. If I had the choice of getting >€400 per week in the hand for a 40 hour week in Londis or €188 per week (plus whatever else I may qualify for) while learning the guitar or working on my golf game I'd say I'd chose the latter myself unless I really really needed the extra money.

I'm not begrudging anyone their dole and I know the (hopefully) vast majority of welfare receivers deserve it and need it really really badly, but the main problem is that the gap between the welfare rates and lower income jobs out there is simply to small.

I have no idea for an easy solution, previous governments have got us into that discrepancy with mad inflation and mad rises and whatnot and now its not easily reversible, but the fact remains we have a problem.

I know lots of people who would be willing to do jobs like this as it gets them off the dole and they have their sanity and feel proud to be earning the money they are given but sadly its the employers out there who refuse to take someone on who has different qualification even though they are willing to do the job and are hard working.

I have come across jobs that are part time and you work 25 hours a week and get just 195 euro. how is that meant to pay your bills fill your car and put food on the table for your kids.

Many businesses can afford to pay a decent wage but they dont.

22-07-2012 02:23PM

waltermc wrote: »

Take medical cards away from the wealthy and take child benefit away from them aswell as they can afford to care for their kids without state help.

Nobody should be getting child benefit for more than 3 kids, rich or poor. If you can't raise them yourself don't expect your neighbour to pay for it. It should also be for children resident in the country.

IMF: social welfare benefits 'too high'

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