THE Budget was pro-work and pro-worker, the Minister for Social Welfare said yesterday.
For the first time, an integrated approach had been taken by the Government as a whole to framing a Budget which focused primarily on long-term unemployment, he told a press conference.
The special employment measures of the Budget were of major significance, he said. "They are intended to give particular help to our unacceptably large number of people who are long-term unemployed, because this group is not benefiting enough from the current dynamic growth in employment which is occurring."
The primary objective of the Budget was to stimulate economic activity and enterprise, "and to help people who are currently unemployed to share in this development".
"Ireland is a small and close knit society and the pain and indignity of long-term unemployment affects everyone in some way, directly or indirectly," he said.
Mr De Rossa made a spirited defence of PRSI. He had supported the adjustment of PRSI rates in the Budget "despite the fact that they represent a loss to the Social Insurance Fund and may mean a consequential increase in the Exchequer contribution to that Fund in future. However, the purpose of the reductions is to stimulate new employment and to reward those workers and employers who are currently producing wealth and contributing to the State' finances
PRSI was an integral part of the social contract" in Ireland, he, said. If it were abolished and if the cost of social insurance benefits was transferred to income payers, the standard tax rate would rise from 27 per cent to 33 per cent and the top rate from 48 per cent to 62 per cent. "I doubt if this would find favour with many taxpayers," he said.
Mr. De Rossa said he has commissioned the Economic and Social Research Institute to recommend what should be the target rates for welfare payments'; in the light of changes since the Commission of Social Welfare' reported in 1986. All groups are at between 92 per cent and 99 per cent of the target rate recommended by the Commission 10 years ago and "this is a major development when you consider that, in 1985, some groups were only at 64 per cent and 66 per cent of the target rate".