Kathleen Lynch (Cork North Central, Labour)
Link to this: Individually | In context

Question 78: To ask the Minister for Finance his views on the projection, set out in the pre-budget outlook, that 75,000 jobs will be lost in 2010; the expected cost to the Exchequer, in terms of increased welfare payments and reduced tax revenue, of these 75,000 job losses; his further views on whether the live register will peak above 500,000 in 2010; and if he will make a statement on the matter. [44861/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
Link to this: Individually | In context

In the Pre-Budget Outlook, based on information to hand at end-October, my Department projected that employment will fall by about 33⁄4 per cent next year, the equivalent of around 75,000 job losses. The latest Central Bank forecast is for a decline of 86,000 in the level of employment next year while the corresponding forecast from the ESRI is for a decline of 80,000 jobs. An update of the Department of Finances projections will be presented alongside the Budget.

The cost to the Exchequer of unemployment per thousand individuals can be determined by reference either to the cost of the Live Register or by the cost of those in receipt of jobseekers payments. A Live Register costing which includes those not in receipt of payments would be €11.4 million per thousand, including secondary benefits. The cost of those in receipt of jobseekers payments and secondary benefits would be €13.1m per thousand. The cost of unemployment is continually evolving given the changing nature of current employment patterns.

Based on certain assumptions, each 1,000 jobs lost would result in a loss to the Exchequer in income tax, PRSI, health and income levies of approximately €9.1 million in a full year.

It now seems likely that the annual average number on the Live Register for this year will be around 400,000. In terms of next year, a revised forecast will be available once the Budget is presented to the Dáil. I would point out, however, that the rate of increase has slowed considerably since the summer and that an average Live Register above 500,000 is now considered less likely.