The Government is to launch a major drive over the coming weeks aimed at showing the vast majority of people in receipt of social assistance that work pays better than welfare.
Research commissioned by Minister for Social Protection Joan Burton estimates at least 75 per cent of people on welfare could increase their income by about 50 per cent by obtaining a job.
By contrast, a small minority – as few as 3 per cent – of welfare recipients would be better off receiving social welfare benefits rather than working, the research suggests.
Under the “Better off in Work” campaign, thousands of welfare recipients will receive letters showing what their take-home pay would be after tax compared to their benefits.
An online tool has also been developed which will allow anyone on welfare or in low-paid employment to compare their take-home pay at a number of salary levels compared with welfare benefits.
Single welfare payment
Those most likely to increase their income significantly through returning to employment are typically people in receipt of a single welfare payment, worth up to €188 a week.
Those who stand to lose by returning to work are typically families in receipt of “poverty trap” payments, such as the child dependant allowance, mortgage interest supplement and rent supplement.
In order to make paid employment more attractive, extra funding has been allocated next year to welfare benefits which provide financial support to working families on low pay.
For example, an extra €55 million is being made available for the family income supplement, a tax-free payment for working parents on low pay. At present, more than 40,000 families benefit from the scheme.
Separately, new figures suggest that authorities are taking a harsher stance towards welfare recipients who refuse to engage in training or education programmes.
The number of people who had their benefits docked is set to double this year. As of last month, some 2,400 people have received penalty deductions from payments of up to €44 per week, compared with a total of 1,455 during all of last year.
The issue of work versus welfare has proved highly controversial over recent times, with different research producing contrasting findings.
An ESRI working paper – which claimed that 44 per cent of people with young children would be better off on the dole than in employment – was removed from its website after receiving widespread media attention.
It was later replaced with a revised version which estimated that fewer than 10 per cent of welfare recipients with young children would be better off on the dole.