Mary Hanafin (Dún Laoghaire, Fianna Fail)

I urge all Members to support us in this and help us to send a clear message to landlords that the State will not be overcharged. On a positive note, agreement has been reached with the Department of the Environment, Heritage and Local Government on 1,000 transfers from rent supplement to the longer term rental accommodation scheme in 2009, which will bring the total number of such transfers to 9,000 this year.

Changes are being made to the jobseeker's allowance, JA, to incentivise 18 and 19 year old jobseekers to avail of education and training opportunities to avoid becoming welfare dependent from a young age. The rate of JA that will be paid to new claimants under the age of 20 is being reduced from €204.30 per week to €100 per week, with effect from the first week of May 2009. It will not impact on current 18 and 19 year olds. When persons on the reduced rate of JA reaches the age of 20, if they still qualify for JA, they will be entitled to the full adult rate.

The full adult rate of the relevant scheme will be paid to 18 and 19 year olds who participate in a full-time youthreach course for young early school leavers; or a full-time course in a senior Traveller training centre; qualify for the back to education allowance, BTEA, for pursuing a full-time second level course or post-leaving certificate course; or participate in a full-time FÁS training course. They can also participate in a post-leaving certificate course or third level course on the same basis as any other young person and may qualify for a third level grant. This measure also applies to new claimants of supplementary welfare allowance who are under 20 years of age.

The numbers affected will be small at first as it will affect only new applicants from the first week in May but these will rise on a weekly basis. Based on current figures, and an expected overall live register average for 2009 of 440,000, we expect this change to affect a weekly average of 5,000 18 and 19 year olds in 2009 and a weekly average of 9,000 in 2010.

These changes have the potential to generate savings of €12 million in 2009 and €26 million in 2010. If take-up of the education and training opportunities is high, fewer savings will be achieved in the short term, but the long-term savings generated by helping young people to avoid welfare dependency would be very significant. The qualified adult rate payable in these cases will also be reduced to €100 per week. This will mean that a couple, where the primary payment is to the 18 and 19 year old will get a total of €200 per week, down from €339.90.

The following people will not be affected - existing claimants; young people with dependent children; those who qualify for the jobseeker's benefit because they have a track record of being committed to the workforce; and people transferring to jobseeker's allowance immediately after exhausting their entitlement to the benefit or those transferring from the disability allowance directly to the jobseeker's allowance thereby preventing them from experiencing a large income drop.

Where an existing jobseeker's allowance claimant under age 20 gets a job and leaves the allowance but loses that job and comes back on the allowance within 12 months, he or she will get €204.30, rather than €100 a week. If this was not done, there would be little incentive for those on jobseeker's allowance to take up offers of work.

The rationale for this change is straightforward, receiving the full adult rate of a jobseeker's payment at 18 years of age, without a strong financial incentive to engage in education or training, can lead to welfare dependency from an early age. While many young people with low levels of education and training were able to get work in construction and other areas when the economy was doing well, they are likely to find it much harder to get work over the next few years. If they do not improve their skills, they are at risk of becoming long-term unemployed from a young age. They are considered to be at a greater risk of having difficulty securing a job than older jobseekers who might have low skills but at least have some work experience. The incentive is for young people to participate in education and training. We have found on a pilot exercise in Clondalkin and Letterkenny that because there was no incentive for these young people they were reluctant to turn up on a Monday.

We are also making important improvements in supports for education, training and work experience. The back to education allowance scheme allows jobseekers who qualify for it to return to education and maintain their welfare payment and that is being improved. Jobseekers who have been out of formal education for at least two years will now be able to access the second level back to education allowance once they have been in receipt of jobseeker's allowance or benefit for at least three months, down from six months. Earlier access is also being provided to the back to education allowance third level scheme which is coming down to nine months.

We are also trying to support people who want to be self-employed. The employee strand of the back to work allowance will be closed to new applicants and the enterprise scheme will last two years rather than four. This allows us to bring in good changes to the back to work enterprise allowance. There will be two new strands, people who are entitled to jobseeker's benefit and have been awarded statutory redundancy or been an employee paying full rate PRSI contributions for at least two years prior to claiming jobseeker's benefit can now access a shorter back to work enterprise allowance scheme immediately. This means that people who lose their jobs who have a good idea and want to set up a new enterprise will be able to get their jobseeker's benefit while setting up their new enterprise.

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