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Home Page > News > IMF orders Irish government to slash dole payments and make cuts to social welfare system

IMF orders Irish government to slash dole payments and make cuts to social welfare system

Proposals come from bail-out partner ahead of December budget

PATRICK COUNIHAN,

IrishCentral Staff Writer

Published Thursday, July 19, 2012, 7:16 AM

Updated Thursday, July 19, 2012, 10:43 AM

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Queue outside a social welfare office in Dublin

Photo by Google Images

The International Monetary Fund has ordered the Irish government to slash dole payments, cut child benefit, and take the automatic right to a medical card away from old age pensioners.

The IMF also wants the government to introduce a hard hitting property tax as it seeks a return on its investment in Ireland.

The proposals have come from the IMF in a hard hitting directive ahead of the government’s December budget.

The IMF is currently bank rolling Ireland’s economic bail-out along with the European Union and their latest orders have been met with harsh criticism from opposition groups and trade unions.

IMF bosses, in Dublin for their regular review of the Irish economy, ordered the Government to cut high social welfare benefits to encourage people back to work.

They warned: “Dole payments are high by international standards and responsible for low exit rates from the Live Register.

“With the Irish economy to grow by just 0.5pc this year, certain welfare payments should be means-tested to avoid long-term unemployment.”

The Irish Independent reports that the Washington based IMF admitted it has targeted a ‘few low-hanging fruits’ for cuts.

It also said that future Irish budgets need to focus on ‘efficiency and fairness’.

The body’s Mission Chief for Ireland Craig Beaumount unveiled a stark assessment of what the IMF expects to see in December’s budget.

He outlined what the paper called a ‘series of unpalatable options’ to cut spending while protecting the vulnerable.

Beaumont specifically mentioned removing the universal right to child benefit for all families and medical cards for the over-70s.

He also suggested targeting child benefit at poor families and limiting the issuing of medical cards.

Beaumont said: “Child benefits are universal. There is no means testing so all families qualify for child benefits. And the child benefit amount has risen very substantially in the last decade so it is quite an expensive part of the social welfare budget.

“We are just laying out the option that you consider paying it to the families who are relatively less well-off and save quite substantial expenditures in the process.”

The IMF also wants to see an end to the practise of giving everybody over 70 a free medical card.
Beaumont added: “Similarly with the medical card, all persons over a certain age, I think it's 70, qualify for a medical card."

The population over 70 is going to be rising so the cost of the medical cards will keep on rising.

“One way to contain that type of demographic pressure is to again look to some means testing on eligibility for those medical cards.”

In response, a spokesman for Minister for Finance Michael Noonan said: “The Cabinet will take the budget decisions at the time of the Budget and will endeavour to implement the measures in as fair a way as possible.

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15 - 36 | See all comments

toTheStreets | Sep 23, 2012, 03:13 PM EDT

whens the protest ?

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MichaelMcGrath | Jul 25, 2012, 07:23 PM EDT

Ocassio, The Anglo Irish Bank Prommissory Note = 31 Billions. Mass Immigration into Ireland cost = 40 Billions and still mounting ( in Health, Education, Welfare and Housing- especially in Welfare money that has to be borrowed from the Troika ) I think the game is up and the cost of mass immigration has to be placed on the Irish Balance Sheet.

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Curitiba | Jul 23, 2012, 05:48 PM EDT

All that's keeping a lot of people going in Ireland is the dole. I can see Ireland becoming a "shell" country very soon, due to the increased rate of emigration that will be taking place.

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seanomelb | Jul 21, 2012, 08:43 PM EDT

The safety net wage in the U.S. is between $7 and $10 for adults the safety net for 16 yr. olds in Australia is $7.30 and $16 for adults.I do not know the safety net in Ireland. I do know that any tampering with protections on social services or minimum wages would be disastrous for Ireland. Sirpeter and Ireland North have nailed it. Beware of the international banks hey are only motivated by self interest and care little for the general populations anywhere.

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sirpeter | Jul 20, 2012, 01:20 PM EDT

@IrelandNorth.That's a good comment.The Shock Doctrine: The Rise of Disaster Capitalism is a 2007 book by Canadian author Naomi Klein weather true or not is an interesting read.The book argues that the free market policies have risen to prominence in some countries because they were pushed through while the citizens were reacting to disasters or upheavals.It is implied that some are man-made crises.Winners and losers of "economic shock therapy" – how narrow groups will often do very well by moving into luxurious gated communities while large sections of the population are left with decaying public infrastructure,declining incomes and increased unemployment and poor health care.I like to keep an eye on what's happening in America.It's an indication of what could be coming our way very fast.According to a special report from the U.S. Census Bureau,46.2 million Americans are now living in poverty.If inflation was still calculated the way that it was 30 or 40 years ago,the poverty line would be much, much higher and millions more Americans would be considered to be living in poverty.The number of Americans that are going to food pantries and soup kitchens has increased by 46% since 2006.Last year, 19.7% of all U.S. working adults had jobs that would not have been enough to push a family of four over the poverty line even if they had worked full-time hours for the entire year.There is a direct link between poverty and every social ill.These cuts to the social welfare system are bad news Irish society in general.

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Searlit | Jul 20, 2012, 12:51 PM EDT

The problem, as I see it is that the, IMF or whichever colluding financial group is controlling the market, say they only want to cut benefits to the wealthy that can afford it, yet when they get their way they use these laws or acts and such to undercut the welfare of the people who really need it. It leads to a form of economic slavery.

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bogsidebunny | Jul 20, 2012, 08:22 AM EDT

Plain and simple so everyone will understand: The irish government will NOT cut the controls over the public. Don't matter who tells them to. Take the toys and candy from the kiddies and there'll be big tantrums!

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IrelandNorth | Jul 20, 2012, 06:11 AM EDT

Ireland didn't fall from being a buoyant Celtic Tiger economy to an economically compromised one over night - it was pushed! Debt entrapment is the new neo-imperialism. The EU I believe, determined to drag the wild colonial boys of Ireland kicking and screaming into their Federal European superstate, may have been instrumental in compromising the economy (See book "Inside Anglo: The Bank that Broke Ireland"). The mainland Europeans, like other colonial predecessors, know that it's far less costly to economically sabotage a clients independent economy than to have to garrison troops in hostile terrain. (The Romans learned this lesson earlier, by installing their client King Herod the Great in Judea to do their bidding). I intuit the IMF are being used as ventriloquists dummies to verbalise unpalatable policies the Irish government really want to impose - without the unpoularity. A kite-flying exercise before the summer recess. Nice cop/bad cop. So that Irish politicianas can go back home from Dublin down the country every long weekend and say to their irate electorate - it's not us. It's those bad IMF dudes in Washington and those sprouts in Brussels. Still, there are very well off rich kids and pensioners collecting state benefits/pension whilst not exactly needing it. And taxing property holders isn't exactly regressive in a week when IC reported 33,000 millionaire households in the greater part of Ireland. Hitting all millionaires for 1% wealth tax would cure a lot of social ills.

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mairint | Jul 19, 2012, 10:19 PM EDT

Here we go, the next step of the New World Order crowd. If this report is true, we can see it ties in with the abortion crowd, the euthanasia bunch. The very young and the very old are just "low hanging fruit" to be disposed of according to this report. Population selection and control is openly declared. We were thinking they had died out with Margaret Sanger and her program that Hitler had adopted. Save the money for the rich dictators by depriving the poor and the elderly who are no longer any use to them. Any poor guys in the IMF?? Trouble is, the Irish Government are no better now. They will do what the NWO dictates because some of them have membership in that too. The recent anti Catholic carry on of Taoiseach Kenny, Gilmore and Shatter proves this.

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seanomelb | Jul 19, 2012, 10:18 PM EDT

Cut social services and the the rich get richer typical IMF crap

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VonLiebenitz | Jul 19, 2012, 09:55 PM EDT

This is idiotic.We never created this debt and we should never of had to pay for it.There is simple solution here.Tax the f**king rich!End corporate welfare and end welfare for the rich i.e low or non existent tax rates and increase to minimum wage to 10 euros.Then people will have more money to spend.The poor cant be taxed any more than they have been. And never should have been hit with cuts in the first place.This inhuman system people erronerously refer to as "free market capitalism" is nothing but a cover for a racket set up to protect the parasitic upper class.A line has been reached.No more cuts on the poor.If they try just wait and see what will happen.It wont be nice my friends. Not at all.They day we wrote off debt in the private banking sector and unsecured loans is they day democracy took a big hit.Are we going to let it die completely.The Irish people make me sick.A bunch of whipped dogs.Pathetic.

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Belphagor | Jul 19, 2012, 04:48 PM EDT

I don't agree with everything the IMF have demanded is fair, especially concerning pensioners but sadly the celtic tiger has been revealed as nothing more than a regular tabby in an oversized tiger suit. The EU poured money into Ireland when they lowered corporate tax rates in the 90's and business was good but when they took the decision to join the Euro they have now become totally dependent of the European Central Bank. It's a case of you will do what the IMF say or you should leave europe, bankrupt and in terrible debt.

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WoundedKnee | Jul 19, 2012, 04:33 PM EDT

Occasio: "Why is this financial crisis the fault of immigrants and not the fault of the bankers/criminal financiers/real estate shysters". Where did he say it was the "fault" of immigrants? Read his post again. As to the bankers etc. that you mention, don't you get it? They're the self-same class that instituted Mass Immigration! It sure wasn't the workers--they have nothing to gain from Mass Immigration. The people who gave Ireland Mass Immigration now give Ireland Mass Emigration.

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irishtonyo | Jul 19, 2012, 03:55 PM EDT

@ forflann Maybe if both you and the so called 'journalist' who wrote this bothered to read the article in the Irish Independent, you would see it does not state the IMF 'ordered' anything. Then again assume both of ye are too lazy to check sources and facts before writing rubbish

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occassio | Jul 19, 2012, 02:11 PM EDT

MichaelMcGrath. Why is this financial crisis the fault of immigrants and not the fault of the bankers/criminal financiers/real estate shysters that rolled the dice weighted to their advantage and for which we now are paying? Yes, there are the lazy and recalcitrant. But they aren’t the majority. For decades in the U.S., manufacturing companies have been sending their businesses overseas to workforces that get no minimum wage or medical benefits. Read the expose about Apple in China. Manufacturing was American’s saving grace and now is decimated. An article in the NY times states that, From the high point in the summer of 1979, through last month, employment in manufacturing has fallen by 8.1 million, to 11.6 million, with most of the drop in just the last decade and, consequently tens of billions of dollars in lost wages. Where there are no jobs (thank you adrienrain), there is no pay and the dole kicks in. The problem is top down so the solution should not be bottom up!

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