€800m a year 'misspent' on work schemes


Up to two-thirds of the annual €1.3 billion spent on assisting the unemployed return to work is spent ineffectively, Prof Philip O’Connell, director of the Geary Institute at UCD, told a conference on the Irish economy yesterday.

He instanced Community Employment Schemes, which have “no impact on getting people back to work. That is the be-all and end-all of it.”

All education and training programmes need to be rigorously evaluated on an ongoing basis, he said, noting that this has not been happening for two decades.

International evidence points to providing training that is focused on what employers need rather than what those out of work may request, Prof O’Connell told the event held in Dublin’s docklands.

He said that immediate State assistance for those who become unemployed should be available to everyone and not targeted at a minority. This has proved difficult because the capacity to interview and assist the numbers out of work still does not exist.

‘Poor record’

He said international evidence proved the importance of monitoring the job-search activity of the unemployed by their case officers, adding that while “encouraging, assisting and cajoling” claimants in their jobfinding efforts was important, credible sanctions were needed for those not complying with search and training obligations. He said Ireland had “a poor record” in assisting, monitoring and sanctioning.

Discussing the role of trade unions, Dr Frank Walsh of UCD said 60 per cent of public sector employees are union members, compared with 20 per cent of private employees. The pay premium enjoyed by trade union members is between 8 per cent and 10 per cent but appears to have fallen substantially during the recession, he said.

In a separate session on the mounting evidence from numerous countries that public assistance programmes for young children improve their life prospects, Emer Smyth of the Economic and Social Research Institute (ESRI) reported on a study of 900 students in 12 schools who were surveyed every year during their time in secondary school.

The study found that streaming by ability can lead to a “vicious cycle” of declining expectations and ambitions among young people and teachers. She said the survey showed a pre-Leaving Cert dropout of rate of 60 per cent among those in lower streams.

She noted that at age nine, nine out of 10 children enjoyed schooling across social classes, but by age 13 divergence emerges, with working-class boys registering much lower levels of satisfaction in school.

The day-long conference was organised by the Dublin Economics Workshop in conjunction with the ESRI, the Department of Economics at the University of Limerick and the Geary Institute.