Is the level of Jobseeker’s Allowance fair?

Wed, 28/03/2012 - 17:20 -- nick

Unemployed Net campaigns for benefits to be increased to a more appropriate level. But different people have different ideas on what ‘appropriate’ means and how it can be measured, so how can we judge right and wrong in this area?

This blog will provide one suggestion, comparing the level of our basic unemployment benefit, the Jobseeker’s Allowance, with that of other European countries. In terms of wealth and culture European countries provide the most clear cut and appropriate comparators, so it is lucky for us that the European Union collects information on benefits and puts it in the public domain.

Eurostat (the EU’s statistics service) figures (quoted in Defresne’s report - http://www.capright.eu/digitalAssets/93623_ETUI-Lefresne_Chap_I_1_.pdf) show that, of 26 EU countries studied, Britain ranked 20th in unemployment benefit payments as a percentage of GDP, below every major competitor country and above only Latvia, Czech Republic, Greece, Romania, Lithuania and Estonia.

The UK’s position within the first 15 members of the EU (an appropriate comparison as it excludes the ex-communist eastern bloc countries, which experienced more than 40 years of low economic growth in the post-war period and have yet to catch up with the EU average income or GDP), and in absolute cash terms, is even more stark. As detailed in the EAPN Ireland report ‘Social Welfare: How Ireland Compares With Europe’ (2009 -http://www.eapn.ie/documents/1_Social%20Welfare%20How%20Ireland%20Compar...) the UK ranks bottom of all countries:

Unemployment Benefit 2007 single person (no dependents) (€)

Country Wages – Benefits

Luxembourg €32,604 – €21,346
Denmark €32,564 – €18,302
Netherlands €32,363 – €15,758
France €32,540 – €15,605
Portugal €32,288 – €14,323
Belgium €32,636 – €12,415
Finland €32,577 – €12,339
Austria €32,499 – €12,212
Sweden €32,643 – €11,924
Germany €32,631 – €11,821
Italy €32,529 – €11,179
Spain €32,625 – €10,522
Ireland €32,747 – €9,662
Greece €32,731 – €4,407
UK €32,381 – €3,631
Note: 1.00 EUR = 0.825498 GBP

The figures are complicated by the fact that additional housing benefit is payable to some in each country and each has different contribution systems, but the figures are comparable as they demonstrate the lowest single-person benefit payable.

The suggestion by some politicians and media outlets that the UK has a particularly generous benefit system for unemployed people that has obvious need of reform is not borne out by the figures. In some of the more generous systems unemployed people receive a percentage of their last wage (up to 90% in some countries, although this level is time-limited in places) for a period of time – can you imagine the newspaper headlines if this system was used in the UK, with a few jobseekers receiving six-figure annual benefit payments?

It is not Unemployed Net’s policy to campaign for benefits to be linked to previous earnings. If additional money is to be made available we believe it should be given where it is most needed, to the poorest claimants, rather than those who have previously had high salaries.

We do believe however that the figures provided above should help to end the damaging rhetoric surrounding the level of benefit payments in this country. Those who criticise recipients and suggest that life on this level of income is luxurious, particularly politicians, journalists and commentators with influence, cannot have had any experience of it, and should hesitate before becoming involved in the debate.

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