Social Protection Expenditure in Ireland 2020

Background Notes

This is the first publication on social protection expenditure in Ireland.  The data are derived from the annual ESSPROS data transmission programme to Eurostat (see What is ESSPROS? section below).

What is Social Protection?

Social protection encompasses all interventions from public or private bodies intended to relieve households and individuals of the burden of a defined set of risks or needs, provided that there is neither a simultaneous reciprocal nor an individual arrangement involved. 

Expenditure on social protection includes: (i) social benefits, which consist of transfers, in cash or in kind, to households and individuals to relieve them of the burden of these risks or needs; (ii) administration costs, which represent the costs charged to the social protection scheme for its management and administration; and (iii) other expenditure, which consists of miscellaneous expenditure by social protection schemes (payment of property income and other).

Social protection benefits granted within the framework of social protection can take many forms; however, in ESSPROS, they are limited to:

• cash payments to protected people;
• reimbursements of expenditure made by protected people; and
• goods and services directly provided to protected people.

Social protection benefits are direct transfers, in cash or in kind, to households and individuals; benefits via the fiscal system are excluded. Social benefits are paid to households by social security funds, other government units, non-profit institutions serving households (NPISH), employers administering unfunded social insurance schemes, insurance enterprises or other institutional units administering privately funded social insurance schemes. Benefits are classified according to eight social protection functions (which represent a set of risks or needs):

• sickness/healthcare benefits – including paid sick leave, medical care and provision of pharmaceutical products;
• disability benefits – including disability pensions and the provision of goods and services (other than medical care) to the disabled;
• old age benefits – including old age pensions and the provision of goods and services (other than medical care) to the elderly;
• survivors’ benefits – including income maintenance and support in connection with the death of a family member, such as survivors’ pensions;
• family/children benefits – including support (except healthcare) in connection with the costs of pregnancy, childbirth, childbearing and caring for other family members;
• unemployment benefits – including vocational training financed by public agencies;
• housing benefits – including interventions by public authorities to help households meet the cost of housing;
• social exclusion not elsewhere classified benefits – including income support, rehabilitation of alcohol and drug abusers and other miscellaneous benefits (except healthcare).

Coverage of data reported

The data presented in this publication are compiled from a variety of sources.  The social protection reported is mainly related to government expenditure via the Department of Social Protection, the Department of Health / Health Service Executive, Child and Family Agency (Tusla), Department of Public Expenditure and Reform (public sector occupational pensions and in-service benefits such as sick pay and maternity pay), Department of Housing, Local Government and Heritage and Approved Housing Bodies. Non-government expenditure is mainly private occupational pensions. Future areas for development include social protection provided by the non-profit sector if not captured by government grants and work-place social protection in the private sector (such as sick pay and maternity pay).  In order to expand the coverage of the data reported robust and reliable data sources for such social protection are being investigated.

What is ESSPROS?

ESSPROS is short for 'European System of integrated Social PROtection Statistics'. ESSPROS is a common framework which enables international comparison of the administrative national data on social protection. It provides a coherent comparison between European Member States of social benefits provided to households and its financing.

The ESSPROS data collection consists of a core system and specific modules. The core system provides annual data on social protection receipts and expenditure.

More information on the ESSPROS transmission programme are available on the Eurostat website here and data are available here.

Gross Domestic Product (GDP) and Modified Gross National Income (GNI*) used in comparative indicators

The GDP and GNI* figures used in this publication are those published in the National Income and Expenditure accounts published on 15 July 2021.

Gross Domestic Product (GDP) is a measure of the total economic activity in the country. It represents total expenditure on the output of goods and services in the country.

While all of the goods and services flowing through Ireland are included in GDP estimates, the flows in and out of the country leave much less in the domestic economy than appears in GDP.  In Ireland's National Accounts, the CSO has developed indicators which take out the distorting effects of globalisation.  These indicators include Modified Total Domestic Demand and Modified Gross National Income (GNI*).

GNI* is an indicator designed specifically to measure the size of the Irish economy excluding globalisation effects. Modified GNI is largely made up of Compensation of Employees paid here to workers, Gross Operating Surplus and Gross Mixed Income of Irish-owned enterprises and Taxes received by the Government.  All of these are available for spending and investment by domestic sectors, which makes GNI* a good indicator of the domestic economy and a better estimate of available resources for expenditure on goods and services such as social protection. In particular, using GNI* as a denominator can be more informative when comparing spending with other countries.