Budget 2015 will help families back to work, provide extra financial support for children and a range of vulnerable groups

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Department of Social Protection - Budget 2015 will help families back to work, provide extra financial support for children and a range of vulnerable groups

14th October 2014 - The significant reduction in unemployment means that overall welfare expenditure will continue to fall in 2015, while creating the space for €198 million of targeted increases and new incentives to assist families returning to work, children, pensioners and people with disabilities who live alone and other vulnerable groups.

Total welfare expenditure in 2015 will amount to €19.415 billion, a reduction of €188 million on 2014. Within this budget, there will still be room for €198 million in targeted increases in key areas because of the significant savings on jobseeker payments as people return to work.

Child Benefit and the Living Alone allowance will be increased, while the new Back to Work Family Dividend will provide additional financial support to help jobseekers with families return to work. Vulnerable households will be supported with the cost of water services, and all long-term welfare recipients will receive a Christmas Bonus of 25% of their weekly payment in light of the costs associated with this period.

Tánaiste and Minister for Social Protection Joan Burton T.D. said: “Through the Pathways to Work strategy to reduce the Live Register, the Department has placed an unrelenting focus on helping jobseekers return to work, with unemployment down from a crisis peak of 15.1% to 11.1% now. This focus will continue in 2015, and will produce significant savings from reduced jobseeker payments, which produces a number of benefits.

“Firstly, it means that overall welfare spending continues to decrease, contributing to the stabilisation of the public finances. Secondly, it ensures there will be no reductions to any social welfare scheme in 2015. Thirdly, we can use some of the savings to increase payments in certain areas to assist the most vulnerable.”

Minister of State at the Department, Kevin Humphreys T.D., said: “This Budget is providing further supports for lone parent and long-term unemployed families to incentivise them to get back into work or self-employment and not remain dependent on welfare.  We will also be able to increase funding for vital schemes such as JobsPlus, through which the Department assists employers with wage costs when they hire long-term unemployed jobseekers. In all, the Department will spend more than €1.1 billion on employee and employer supports next year – a firm statement of intent that we are going to increase the pace of progress in reducing unemployment.”

The targeted increases and incentives are aimed at four key areas:

  • Assisting those with families to return to work, including lone-parent families;
  • Helping all families in the State with the cost of raising children;
  • Recognising the additional pressures on pensioners and people with disabilities who live alone, and
  • Helping vulnerable households to meet the costs associated with water services.

Return to Work
Budget 2015 is providing a new incentive for long-term unemployed jobseekers with children to return to work. The scheme will be called the Back to Work Family Dividend, and will see jobseekers returning to work retain the element of the welfare payment which they received for their children.

Currently, those in receipt of jobseeker payments receive an additional increase of €29.80 per week for each child they have, a payment known as a Qualified Child Increase. Under the Back to Work Family Dividend scheme, these jobseekers will retain that payment of €29.80 a week for each child in full for the first year in employment, and will retain half the payment – or €14.90 per child - for the second year in employment. 

This means that over the two years, a family with one child will receive additional support of €2,324 to supplement wages.  A family with two children will receive €4,649, those with three children will get €6,973, while those with four or more will get €9,298. 

The Back to Work Family Dividend will be additional to any entitlement the family may have under the Family Income Supplement (FIS) scheme and will not affect the level of the FIS payment.

The Tánaiste said: The Working Family Dividend will remove one of the last remaining welfare traps in the system and greatly assist families looking to return to work.”

Due to the success of the JobsPlus scheme which was initiated in July 2013, there will be a doubling of the number of places from 3,000 to 6,000 to incentivise employers to give work to long-term unemployed jobseekers.  In addition, a new JobsPlus strand for young people will be launched early in 2015 under the Youth Guarantee.

Families with Children
With effect from January 2015, families with children will receive an extra €5 per month for each child, bringing the monthly rate of Child Benefit from €130 to €135 per child. This increase recognises the sacrifices that families made during the economic crisis, and will benefit 613,000 families next year at an additional cost of €72 million, bringing the total amount spent on Child Benefit in 2015 to €1.97 billion.

The Tanaiste said: “I fought to protect Child Benefit as a universal payment throughout the crisis because of its crucial importance to families in meeting the costs of childhood, and I make no apologies for that. Similarly, I make no apologies now for increasing the payment when we have the scope to do so.”

Funding for the Department’s School Meals Programme is being increased by €2 million in 2015.  This additional funding will be used to increase payments to existing DEIS schools to take account of the increased number of pupils, with a focus on the provision of breakfast clubs where feasible.

Pensioners and People with Disabilities
Pensioners and people with disabilities who are living alone will have their Living Alone Allowance increased to €9.00 per week from January.  Some 177,500 people will benefit from this increase.  This payment was last increased in 1996.  The Tánaiste said that she was providing this increase in recognition of the fact that people living alone can be more vulnerable to economic deprivation than two-person households where resources can be pooled. 

Water Services Support
In line with the Government commitment in its Statement of Priorities 2014–2016, the Department of Social Protection will be providing supports for Water Services to a number of its customers.  Each quarter commencing in January, €25 will be paid to pensioners, people with disabilities and carers who are receiving a Household Benefits Package.  Some 415,000 households will benefit from this measure at a cost of €42 million next year. 

An increase of €100 per year will be provided to all Fuel Allowance recipients who do not already receive the Household Benefits Package. Some 238,000 households will benefit from this measure at a cost of €24 million.

Christmas Bonus:
At the end of September, there were more than 1.43 million people in receipt of a weekly payment in respect of almost 2.2 million beneficiaries.  In addition, some 613,000 families are in receipt of Child Benefit each month. A Christmas Bonus of 25% of the rate of the weekly payment will be paid to all long-term welfare recipients in early December, at a cost of over €63 million.  The Tánaiste said: “The Christmas Bonus was abolished by the previous Government in 2009.  I am pleased to say that I am in a position to partially restore the Bonus this year - it is in recognition of the position of vulnerable households”.


Note to Editors:

Main social welfare elements in Budget 2015

Return to Work Initiatives - €1.1 billion to be spent on employment supports

  • New Back to Work Family Dividend for lone parent and long-term unemployed families with children who return to work or self-employment, at a cost of €22 million.  
  • Doubling of JobsPlus places from 3,000 to 6,000, at a cost of €12 million.
  • New employment programme, JobPath, established with funding of €12 million.

Families with Children - €2.4 billion to support families with children

  • Extra €5 on Child Benefit for each child per month from January to benefit 613,000 families, with a total of €1.97 billion to be paid in Child Benefit in 2015.
  • Additional €2 million for the Department’s School Meals Programme.
  • Over €349 million will be provided for Family Income Support (FIS).
  • Back to School Clothing and Footwear Allowance and all other supports maintained.

Older People and People with Disabilities - €9.25 billion in supports

  • Living Alone Allowance to increase €9.00 per week from January – 177,500 people to benefit.
  • Pensioners aged 80 and over will continue to receive an extra €10 per week
  • Free Travel Scheme is fully maintained.
  • Electricity/Gas Allowance and Free TV Licence are unchanged.

Water Services supports - €66 million to be provided in 2015

  • €100 per year (in four quarterly instalments of €25) to be paid to pensioners, people with disabilities and carers receiving a Household Benefits Package.
  • €100 per year to be provided to all Fuel Allowance recipients who do not already receive the Household Benefits Package.
Last modified:14/10/2014

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