WELFARE expenditure could rise, Social Security minister Mary Lowe warned the States yesterday. Supplementary benefit expenditure increased by £3.3m. last year compared with 2004 and estimates indicate that a further £2m. rise can be expected in 2006.

Last year the expenditure was £10.7m. – up 18.5%. The estimated out turn for 2006 is £12.7m. – up 18.9%.

‘Welfare expenditure is going up when we all want government expenditure to be cut back. I think that unless we recognise that this is inevitable, the outlook for our low- income groups will become a whole lot worse,’ warned Deputy Lowe.

There are 400 single parents on benefit in the island, which accounts for nearly one third of expenditure.

In 1998 there was a similar number of claimants but that dropped to just over 300 by 2002 before starting to rise again.

‘Perceptions change quickly. In 2005 we were pointing to the expenditure as evidence that real money had been put into the benefit rates paid, in particular, to single pensioners and single parents.

‘That remains relevant, because if we are going to make any substantial difference to poverty levels, it will not be done with sums of money that are too small to notice in the accounts. It will need sums of money that will make you wince,’ Deputy Lowe told States members.

But she stressed that benefit rates were only part of the picture.

Over the past two to three years, Social Security has had a rising number of people claiming benefit on the grounds that they were single parents, unfit for work through sickness or unemployed.

‘These are expensive claims for us because the people often have no income at all, so supplementary benefit is paying a full living allowance and often a rent allowance as well.’

Claims by pensioners tend to be less expensive because they are usually topping up a part or full pension. The number on benefit has remained steady.

Deputy Lowe said some found it went against the grain for Social Security’s budget to be rising when others were being reduced, as restraint was the objective.

‘The extra single parents and people sick and unemployed are not just figures in a set of accounts. They and their families are your fellow islanders and a part of this community who need financial support.

‘We’re not just sitting back and accepting claims as one-way traffic. We are doing our best, within our resources, to help people move from benefit back into work.’

She will report some of the successes to the Social Policy Steering Group when it meets next week.

‘But I do have to warn of further increases in welfare expenditure if, for example, Social Security is asked to administer a scheme of assistance where substantially increased TRV causes financial hardship. That will need money and staff.

‘If we have to introduce new benefits to protect low income people from the effects of general increases in charges, this has to be staffed. Means testing is heavy on staff.’

General revenue staffing costs, according to the interim financial report produced by Treasury and Resources, stand at £972,000.

‘If you include the whole thing, including staffing costs to the Guernsey insurance fund, Guernsey Health Service fund and long-term care insurance fund, our payroll costs, including social insurance and superannuation costs, amount to £3.69m.’

Social Security will in September bring forward its proposals for contribution and benefit rates for 2007, as directed by the States last month.

Deputy Rhoderick Matthews raised concerns over the rising number of claimants. He believed more could be done on the issue of childcare and getting mothers back to work and questioned whether all payments were value for money.