Aengus Ó Snodaigh (Dublin South Central, Sinn Fein) | Oireachtas source

I begin by quoting what the Minister for Social Protection, Deputy Joan Burton, said last night:

Welfare expenditure acts as what economists often call a Keynesian "automatic stabiliser". This means it acts in a counter-cyclical manner to support the domestic economy by putting money into the hands of consumers and thus into the tills of businesses, many of which are small and medium-sized... We must ask ourselves what is the impact of social welfare payments on domestic business. It is very strong.

In saying this, the Minister demonstrated a clear understanding of the economic impact of social welfare spending. However, actions speak louder than words. The Minister and the Labour Party clearly lacked the courage or conviction to follow through on that understanding because it was she who was responsible for cutting social welfare spending by €800 million last year and she is now gearing up to cut at least a further €540 million this year. We now see that she has not been cutting social welfare payments in ignorance of the implications for the economy and those on social welfare; rather, she is proposing and making social welfare cuts wilfully and in full knowledge that in doing so she will continue to depress demand in the domestic economy, costing further jobs year on year. She opened her speech by talking about the Government's twin track approach to increasing employment and reducing unemployment. This approach comprises the Action Plan for Jobs and the Pathways to Work programme. However, she neglected to mention that despite promising 100,000 new net jobs by 2016, the economy had lost some 33,400 net jobs since the Government's twin track approach had been launched.

The Minister proudly championed the handful of Intreo offices now in operation, claiming they would enable people to get back to work more quickly. She gave an example of how this would operate, telling us that if an employer in Sligo had three jobs, the local Intreo office would be able to offer that employer suitably qualified and interested individuals. That is logical and all well and good, but according to the European Commission's figures, the reality is that there will be 150 jobseekers eagerly pursuing and in need of those three jobs. Pathways to Work, or plank 2 of the Government's approach to the unemployment crisis, is almost redundant in absence of a credible plank 1, namely, a strategy to create and deliver jobs.

The Minister spent her first year in office cutting social welfare allowances and claiming that anyone in difficulty could always go and talk to the community welfare officer, but in many cases one can no longer do this. If people experience a crisis, for example, with regard to their rent allowance payment, they are directed to make contact through a PO Box No. This is great news for those in crisis.

The Minister spoke in unreserved congratulatory tones about the turnover on the live register. However, she did not mention the damning statistics that prove the approaches of the Government and the previous Fianna Fáil-led Government have been an abject failure. In the past year, while the Labour Party has been in power, unemployment has increased from 14.1% to 14.8%. Long-term unemployment has reached an all time high of over 200,000 people, six times the number in 2007. The long-term unemployed now account for 60% of the unemployed, up from a figure of 54% a year ago when the Labour Party took up office.

Underemployment is also growing but is often overlooked in a crisis. Since the Government came to power, the level has increased from 120,000 workers to 150,000. These are workers who would work more hours if they were available. Since the Government came to power, 167,700 have left the State. The number has risen from 80,600 to 87,000 in the two years the Government has been in power. The largest component of this group appears to be workers in the 20 to 34 year age group. We must conclude from this evidence and evidence published today by the Society of St. Vincent de Paul that the Government and its approach to the economy are an abject failure. I urge the Government, even at this late stage, to consider an alternative way, one proposed by Sinn Féin and others. It might be pleasantly surprised by how our approach would turn the economy around.

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