Ireland may be among the most prosperous countries in Europe, but a new report shows international competitiveness is eroding and that the social welfare system is ineffective in combating poverty.
The report, Measuring Ireland's Progress, 2005, published by the CSO today, shows that between 1998 and 2004, Ireland outperformed the rest of the EU in terms of income, employment growth and public finances.
David Stanton, Fine Gael
In 2004, Ireland had the second-highest GDP per person in the EU. However, when measured in terms of gross national income, which strips out the multinational sector and EU subsidies, Ireland falls back to eighth place, still 16 per cent above the EU average.
The unemployment rate in Ireland increased slightly from a low point of 3.6 per cent in 2001 to 4.2 per cent in 2005. However, Ireland had the lowest unemployment rate in the EU in 2005 at less than half of the EU average. The long-term unemployment rate was 1.4 per cent in 2004, which was considerably better than the EU average of 4.1 per cent.
However the report, which contains a wide range of economic and social statistics to inform the partnership discussion process, also highlights weaknesses in certain key areas.
Ireland's international trade competitiveness has deteriorated since 2000, mainly due to higher inflation and an appreciating euro. Cumulative inflation in Ireland over the period 2000-2005 was 18 per cent compared to an EU 25 average of 11 per cent. Over the same period, the euro increased in value against the dollar by 35 per cent.
The proportion of Irish people at risk of poverty, after pensions and social transfer payments were taken into account, was 21 per cent in 2004. This was one of the highest rates in the EU.
In the United Kingdom this was 18 per cent, in France 14 per cent, in Luxembourg 11 per cent and in Czech Republic only 8 per cent.
In 2004, 18 per cent of males and 20.8 per cent of females were at risk of poverty in Ireland, giving an overall rate of 19.4 per cent. Females were at higher risk of poverty than males across all age groups.
The effect of pensions and social transfers on reducing the at-risk-of-poverty rate was low in Ireland compared with other EU countries.
In 2002, social protection expenditure in Ireland was only 15.9 per cent of GDP. This was half of the rate in Sweden and the lowest of the EU 15 countries.
Inflation in Ireland has been consistently higher than the EU average since 1999. Cumulative inflation over the period 1996-2005, at 132.1 per cent was 14 percentage points higher than the EU 25 average.
In the first half of the 1990s, price levels in Ireland were below the EU 25 average. Since 1995, Ireland has been relatively more expensive than the EU 25 average and by 2004 the price level here was over 23 per cent above the EU average.
Denmark was the only EU state with higher costs of living than Ireland in 2004. The cost of living in Iceland and Norway was on a similar scale.
Fine Gael spokesman on social and family affairs David Stanton said the figures "strongly indicate that this Government still cannot get a grip on the human blight that is poverty despite years of growth and a bulging Exchequer".
"The challenge for an effective, active government is to eradicate child poverty and drastically reduce the number of those at risk of poverty. After nine years of power and plenty, the Government has failed to meet that challenge.
"Fine Gael in Government will instigate an inter-departmental approach to achieve the ultimate goal of the National Action Plan against Poverty and Social Exclusion which is to totally eradicate consistent poverty. In a successful economy it is shameful that one in five of us are at risk of poverty and Fine Gael and our colleagues in Labour will change this."
Dan Boyle, Green Party
Green Party spokesman on social affairs Dan Boyle said the findings show that the proportion of people at risk of poverty, after pensions and social transfer payments were taken into account, was 21 per cent in 2004.
"The fact that this figure has remained static from last year's findings is a worrying trend
"Taken together with recent findings such as the Combat Poverty Agency's report that almost one in five Irish children live in income poverty for five years or more shows that this matter needs priority attention.
"As the largest source of funding for areas such as health, housing and education, the forthcoming National Development Plan is likely to be the main vehicle for the achievement of national anti-poverty targets.
"Stringent poverty impact assessment and social inclusion indicators must therefore be made central components of this plan. Ireland's income divide cannot be left to continue; it is time that we all benefited from our successful economy."