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Replacement rates, compulsory activation

Replacement rates, compulsory activation or
How much do unemployed people receive compared to their wages? and the question of compulsory work to receive assistance
The Minister for Social Protection, Eamon O Cuiv, gave details to Michael Ring (FG, Mayo) of replacement rates – the proportion of their former wages that unemployed people receive in unemployment assistance and a crucial issues in debates about poverty traps and the incentive to work (Dail Eireann, Debates, 23rd November 2010, 687-9).  The minister told him that the majority of social welfare recipients had a replacement rate of less than 70%.  To be more precise, compared to the national minimum wage, replacement rates were 64% for a single person, 70% for a couple with one earner, 73% for a couple with one earner and one child and 76% for a couple with one earner and two children.  Compared to the average industrial wage, the replacement rates were 53%, 65%, 69% and 72% respectively.

The minister was then asked by Emmet Stagg (Lab, Kildare N) as to whether unemployed people would be required to work in order to receive social welfare payments as part of ‘activation’ courses (Dail Eireann, Debates, 23rd November 2010, 701-3).  The minister, Eamon O Cuiv told him that it was his intention to commence §18 to 20 of the Social welfare (miscellaneous provisions) Act, 2010 on 1st January, adding that the national employment action plan must have sanctions for people who say that they are not available for and are actively seeking work but who do not avail of appropriate courses or training and refuse to participate in programmes.  It was intended to introduce sanctions provided for in law to give teeth to the plan and the names of those willing to participate and cooperate with the plan will be put on a register.  ‘Obviously, those who do not participate in the national employment plan, which is an integral part of our approach, will be subject to sanctions.  That is the way it should be’.