ESRI says social welfare data misinterpreted by OECD, IMF

Thursday 27 September 2012 23.04
ESRI research challenges figures by the OECD on social welfare
ESRI research challenges figures by the OECD on social welfare

The Economic and Social Research Institute has criticised the OECD and the International Monetary Fund for misinterpreting data on Irish social welfare rates.

According to new research by the ESRI, social welfare payments to a majority of unemployed people in Ireland are in line with the European average.

It states that only a small number of people are better off on social welfare than taking a job.

The Troika has been pressing the Government to make changes to the social welfare system,.

It claims that a high level of welfare payments can act as a disincentive to unemployed people to take up paid work.

The claim is based on figures from the Organisation for Economic Co-operation and Development.

They show that Ireland has one of Europe's highest replacement rates - the percentage of a person's salary replaced by social welfare if they lose their job.

This has been challenged by the ESRI, which says Irish replacement rates are only high when rent and mortgage supplement are included.

As only one in eight jobseekers gets this supplement, the ESRI argues it should be excluded from comparative figures.

On this basis, Irish welfare payments are in line with the west European average.

It says only 6% of the total population would be better off on the dole than working, and of this group around three quarters have jobs and chose to work.

Meanwhile, employers' group IBEC says the property tax should be introduced in full in the next Budget, rather than phased in over three years.

This could bring in most of the Government's tax requirement, and IBEC says it would be less damaging to the economy than a series of other tax changes to raise the same amount.

Keywords: oecd, imf, esri

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