Social welfare payments should be increased to 50 per cent of the average household income, the Irish National Organisation of the Unemployed (INOU) says in its Budget submission. At present, they are about 40 per cent.

This is one of the major recommendations in the submission and is in line with proposals contained in the draft National Economic and Social Council report. However, employers and the Department of Finance are resisting the proposal, which has yet to be adopted by the social partners.

The INOU is also calling for tax reforms to target the low-paid. It says that personal allowances should be increased by £1,000 a year to £5,200 (£10,400 for a married couple). The standard rate band should be increased by £1,000 to £15,000 (£30,000 for a married couple). This would mean that no one on the average industrial wage would pay tax at the higher marginal rate.

The organisation is also seeking to increase allowances for 51,000 widowed people and 33,000 single parents, who are among the groups facing the greatest obstacles to re-entry to the labour market. It puts the overall cost of its proposals at £750 million.