Arthur Morgan (Louth, Sinn Fein)
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Question 1227: To ask the Minister for Social Protection the social protection expenditure as a proportion of Gross Domestic Product; the social protection expenditure as a proportion of Gross Domestic Product in comparison with other EU27 member states; and if he will make a statement on the matter. [31923/10]

Éamon Ó Cuív (Galway West, Fianna Fail)
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Eurostat, the Statistical Office of the EU, publishes comparisons of social protection expenditure as a percentage of GDP across the EU. This encompasses not only social welfare expenditure but also expenditure in areas such as health care, social housing, employment support programmes and other social inclusion programmes. The latest such statistics were released on September 2nd 2010 and cover developments up to and including 2007. No comparable figures are yet available for 2008-2010.

When examining such data, it is important to remember that gross expenditure measures do not take account of social charges or taxes which may be levied on benefits after they are paid, nor do they include transfers made by means of tax concessions, as opposed to direct cash payments. For example, tax relief on contributions towards occupational and private pensions, which are an important feature of Ireland's pension system, is not counted as expenditure.

The EU-ROSTAT release draws attention to the fact that the EU average masks major national differences in the structure of social protection funding, partly related to differing levels of wealth between countries, and also reflects differences in social protection systems, demographic trends, unemployment rates and other social, institutional and economic factors

The level of expenditure is also significantly influenced by the age profile of the population. Ireland, currently with the youngest population in the EU, needs to spend less on pensions and healthcare/care of the elderly than most other member states. In 2007, social protection expenditure accounted for 26.2% of GDP in the EU-27 countries. The corresponding ratio for Ireland was 18.9% — up 0.6 percentage points from 2006 (18.3%). According to recent OECD estimates (W. Adema — presentation to Social Justice Ireland conference, Sept 21st 2010), social protection expenditure could rise by 4 percentage points of GDP by 2011 due to increased Social Welfare expenditure and lower GDP levels compared to 2007.

Ireland's per capita expenditure in 2007 (€6,561.30), is higher than the EU-27 average of €5,725.90 and the average annual growth in per capita expenditure between 2000 and 2006 was 8.7%, second only to Romania (11.6%) in the EU, and over four times the EU25 average of 1.9% for this period (EU27 was 1.2%). Overall spending on Social Welfare in Ireland in 2009 was €20.6 billion, an increase of just over 15% on 2008 (€17.8 billion) and 32% on 2007 (€15.5 billion).