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Dáil Éireann debate -
Tuesday, 6 Nov 1962

Vol. 197 No. 3

Committee on Finance. - Vote 51—Office of the Minister for Social Welfare.

Tairgim:

Go ndeonófar suim fhoirlíontach nach mó ná £10 chun íoctha an mhuirir a thiocfaidh chun bheith iníoctha i rith na bliana dar críoch an 31ú lá de Mhárta, 1963, le haghaidh Tuarastail agus Costais Oifig an Aire Leasa Shóisialaigh.

Mar is eol do Theactaí, d'aontaíodh meastacháin mo Roinne-se i mí Iúil seo chaite gan aon díospóireacht. Tá Meastachán Foirlíontach á thabhairt ós comhair na Dála anois chun caoí a thabhairt do Theachtaí cúrsaí leasa shóisialaigh a phlé.

Tá trí Meastacháin le h-aghaidh na seirbhísí as a bhfuil mo Roinn-se freagarthach, mar atá, Vóta 51-Oifig an Aire, Vóta 52—Árachas Sóisialach agus Vóta 53—Cúnamh Sóisialach. 'Sé suim iomlán na dtrí Meastachán seo ná £26,001,600. Beidh suim bhreise ag teastáil le h-aghaidh seirbhísí na Roinne sa bhliain seo nuair a chiurtear san áireamh costas na bhfeabhsanna ins na scéimeanna leasa shóisialaigh a fhógair an tAire Airgeadais san Cháinaisnéis, agus a reachtaíodh in Acht Leasa Shóisialaigh na bliana seo. Tabharfar Meastacháin Fhoirlíontacha ós comhair na Dála níos déanaí chun an t-airgead bhreise a chur ar fáil.

Tá iomlán na dtrí Meastachán níos mó de £87,700 ná iomlán na dtrí Vótaí seo anuraidh mar aon leis an Vóta Fhoirlíontach le £135,000 a deonadh sa bhliain sin le h-aghaidh Cúnaimh Sóisialaigh.

I gcás Vóta 51—Oifig an Aire Leasa Shóisialaigh — is faoi FoMhírcheann A atá an deifríocht is mó i gcomparáid leis an bhliain roimheseo. Táthar ag lorg £98,000 sa bhreis faoin Fho-Mhírcheann seo de bhrí gur méadaíodh rátaí tuarastail oifigeach na Roinne i rith na bliana seo chaite.

San Meastacháin le h-aghaidh Árachais Shóisialaigh, táthar ag lorg £6,241,000 ón Stát-Chiste, sé sin laghdú de £80,000 i gcomparáid leis an bhliain 1961-62. Séard is cúis leis an laghdú ná go bhfuiltear ag súil le £462,000 sa bhreis san ioncam ó rannaíocaí árachais shóisialaigh sa bhliain seo. Meastar go mbeidh an chaiteachas níos mó chomh maith, mar shompla, £153,000 sa bhreis ar Shochar Mhíchumais, £96,000 ar Shochar Cóireála, agus £102,000 ar Phinsin Ranníocha Baintrí.

I gcás Cúnaimh Shóisialaigh—Vóta 53, tá an ghlan mheastachán níos mó de £129,000 ná an méid a deonadh le h-aghaidh na bliana 1961-62 agus an Meastachán Foirlíontach de £135,000 le h-aghaidh na bliana sin a chur san áireamh. Séard is cúis leis an méadú ná go bhfuil costas na bhfeabhsanna a rinneadh ins na scéimeanna Cúnaimh Shóisialaigh le h-éifeacht ó thosach mí Lúnasa 1961 iníochta ar feadh na bliana seo go léir. Cosnóidh na feabhsanna seo £250,000 sa bhreis ar a gcostas sa bhliain seo chaite, nuair nach raibh siad i bhfeidhm ach ar feadh ocht mí. Táthar ag súil áfach le spáráil faoi Fho-Mhírchinn Áirithe, agus dá bhrígh sin ní rachaidh an bhreis costas thar £129,000.

Faoi Fho-Mhírcheann A — Pinsin Seanaoise — tá méadú de £182,000, ach nuair a cuirtear an Meastachán Foirlíontach san áireamh níl ach £42,000 sa bhreis dá lorg i mbliana. Bhéadh níos mó ag teastáil faoin Fho-Mhírcheann seo murach go bhfuil laghdú i líon na bpinsinéiri de thoradh na scéimeanna pinsean ranníochach.

Tá méadú de £94,000 faoi Fho-Mhírcheann D — Pinsin Neamhranníocacha Baintreach agus Dílleachtaí, ach nuair a chuirtear an Meastachán Foirlíontach san áireamh, táthar ag lorg £1,000 níos lú ná an t-iomlán a deonadh anuraidh.

Sa mhéid atá ráite agam, do mhínigh mé na fáthanna is bun leis na príomh-athruithe idir na meastacháin don dá bhliain atá i gceist. Más mian le Teachtaí a thuille eolais d'fháil ar sheirbhísí áirithe, tabharfaidh mé dhóibh é.

As the House is aware, the three Estimates for my Department were passed without discussion last July. The purpose of this Supplementary Estimate for a token sum of £10 is to provide an opportunity for discussion now and it will be open to Deputies to raise points on any of the three Votes.

The three Estimates and the amounts provided by the Exchequer for the year 1962-63 are—

Vote 51—Office of the Minister for Social Welfare

£532,600

Vote 52—Social Insurance

£6,279,000

Vote 53—Social Assistance

£19,190,000

I should like to make it clear that the sums mentioned for social insurance and social assistance do not take account of the cost of the improvements in the social insurance schemes and the increases in the social assistance rates announced by the Minister for Finance in the Budget Statement and given effect to in the Social Welfare (Miscellaneous Provisions) Act, 1962. The necessary provision for these will be made by way of Supplementary Estimates later in the financial year.

The total of the three Estimates, apart from the token sum of £10, is £26,001,600, an increase of £87,700 on the total of £25,913,900 for these Votes for the previous year, including a Supplementary Vote of £135,000 for Social Assistance.

In the Estimate for the Office of the Minister for Social Welfare a net sum of £532,600 was provided to meet the salaries and other administration expenses borne on that Vote. The main variations, as compared with the previous year's Vote, are an increase of £98,000 for salaries and wages under Subhead A and an increase of £64,660 under the Appropriations in Aid subhead.

The increase on Subhead A is mainly due to the pay increases granted to civil servants with effect from various dates last year. The Department's costs of administering the social insurance scheme are chargeable to the Social Insurance Fund. These costs are met in the first instance from the Vote for the Office of the Minister for Social Welfare, but the Vote is recouped from the Fund through the Appropriations in Aid subhead. The increase of £64,660 under this subhead is mainly due to the increased provisions for salaries and wages of staff administering social insurance schemes.

In the Estimate for Social Insurance, provision was made under Subhead A for payment by the Exchequer into the Social Insurance Fund of the estimated amount by which the expenditure of the Fund will exceed its income in 1962-63. The estimated amount was £6,241,000, a decrease of £80,000 on the provision for 1961-62.

The expenditure of the Fund in 1962-63 was estimated at £17,719,000 made up as follows:—

£

Old Age (Contributory) Pensions

4,650,000

Disability Benefit

4,899,000

Widows' and Orphans' (Contributory) Pensions

3,281,000

Unemployment Benefit

2,760,000

Treatment Benefit

430,000

Maternity Benefit

137,000

Marriage Grant

76,000

Administration

1,486,000

Total

17,719,000

The income of the Social Insurance Fund in 1962-63 was estimated at £11,478,000. It consists of £10,750,000 from employment contributions, £613,000 in income from investments of the Fund and £115,000 in receipts under reciprocal arrangements.

The decrease of £80,000 in the amount of the Exchequer contribution as compared with 1961-62 is the net result of variations, up and down, in the items constituting the expenditure and income of the Fund.

On the expenditure side, the main increases are £153,000 for disability benefit, £102,000 for widows' and orphans' (contributory) pensions, £96,000 for treatment benefit and £100,000 for administration costs, offset by a reduction of £65,000 in the provision for unemployment benefit.

The increases for disability benefit and treatment benefit were based on expenditure in 1961-62, which shows a rising trend. The increase in the requirement for widows' and orphans' (contributory) pensions is due to an anticipated continuing rise in the number of widows' contributory pensions in 1962-63. The reduction in the provision for unemployment benefit was based on experience in 1961-62.

The increase of £100,000 in the provision for administration costs is mainly due to the Civil Service pay increases already mentioned. On the income side, the total Estimate shows an increase of £463,000 over the previous year's provision. This increase is almost entirely due to estimated additional income from employment contributions.

As regards social assistance, the net Estimate for 1962-63 is £19,190,000, an increase of £129,000 on the provision for 1961-62 including the Supplementary Vote of £135,000 for that year. I should mention that the figures shown in the 1961-62 columns in the Estimates Volume do not include the increases in last year's estimates rendered necessary by the improvements in the Assistance services which took effect from the beginning of August last year. These increases were voted in a Supplementary Estimate which was passed in March last after the Volume of Estimates was published. The net amount of the Supplementary Estimate for Social Assistance for 1961-62 was £135,000.

The increase of £129,000 on the revised provision for 1961-62 arises out of the necessity to provide for the cost of the increases in rates and other improvements granted from August, 1961, for the whole of 1962-63 as against eight months in 1961-62. These increases and improvements were estimated to cost an additional sum of £250,000 in 1962-63 compared with the cost in 1961-62. The increase on the 1961-62 provision would, therefore, have been £250,000 were it not for certain anticipated savings in 1962-63.

The provision of £9,182,000 for old age pensions is £182,000 higher than the original estimate for this subhead last year. The increase is, however, reduced to £42,000 when a supplementary provision of £140,000 for this service last year is taken into account. The increase is due to the provision for a full year for the rate increases and other improvements effected by the Social Welfare (Miscellaneous Provisions) Act, 1961. The increase would have been greater but for a reduction in the number of non-contributory old age pensioners resulting from the continuing impact of the contributory pension schemes.

The provision of £1,100,000 for unemployment assistance in 1962-63 is £10,000 less than the provision of £1,110,000 in the original Vote for 1961-62, notwithstanding the fact that the estimate for unemployment assistance for 1962-63 includes £206,000 to cover the estimated cost in this year of the increases and concessions brought about by the 1961 Act already referred to. The reduced provision for 1962-63 was based on the improved unemployment position in 1961-62.

As regards widows' and orphans' non-contributory pensions, the provision of £1,842,000 for 1962-63 is £94,000 more than the original provision of £1,748,000 for this service in 1961-62 but £1,000 less than the revised provision of £1,843,000 effected by the Supplementary Estimate for that year. The decrease in the provision for 1962-63 is due to an anticipated continuance in this year of the downward trend in the number of non-contributory pensioners.

The provision of £338,000 for appropriations in aid in 1962-63 is little different from the original provision of £334,500 for the previous year. This latter figure was, however, altered to £435,000 by the Supplementary Estimate for 1961-62. The increase of approximately £100,000 in that year was mainly due to a large volume of adjustments between the Social Assistance Vote and the Social Insurance Fund in respect of interim payments of non-contributory old age pensions which arose in 1961-62 following the introduction of the old age contributory pensions scheme and the removal of the upper age limit of 70 years for widows' contributory pensions in January, 1961.

I have explained briefly the causes of the main variations between the provision for the current year and that for last year. I do not think it is necessary for me to go into the matter in any greater detail, but I will of course give Deputies any further particulars they may require in relation to specific items.

Normally, the Estimate for Social Welfare would present the House with the only opportunity it would get during the year to examine the administration of the Minister's Department but it so happened this year we have had a number of opportunities presented to us. The Minister's statement is one which is swamped with a lot of figures, comparative and otherwise, and it would require considerable time to examine them in detail against the figures that were quoted for other years. However it is clear from listening to the Minister's statement that any increases in the Estimate for this year have been created by increases in wages and salaries to a very great extent. This prompts one to comment on the necessity for applying to the beneficiaries the money is intended to reach that measure od support which they would need in these times to meet the cost of living that now operates.

When the Minister mentions here and there in the course of his statement increases, improvements, and so on, he fails to advert to the fact that during the years to which he refers the country has suffered a constant reduction in the value of money. It was only last week that the Taoiseach's Department informed us that what would in 1945 provide 20/- worth of goods and services will now provide only 11/10d. worth. Even making a comparison with last year, the quantity of goods one could purchase has again decreased inasmuch as it would require more to buy the same quantum of goods and services that could be bought this time last year. The complete abolition of food subsidies drove the cost of living figure into an orbit which it is in since the Government decided upon that course and it is in that light we must view the efforts being made since then to ease the situation on some sections of the community because of the impact of this increase in the cost of the necessities of life. Each one of us in his own locality, and in his own constituency, knows there are many people whose incomes have not been increased in such a manner as completely to cancel the effect of the drastic increases in the cost of living which have occurred over the last four or five years.

Regarding the administration of the Department, the extension of the areas of the investigating officers will exacerbate the situation that unfortunately exists where the local sub-committees are not in that degree of touch with the investigation officer that one would like. Many members of local sub-committees are frustrated in their efforts to advance the interests of the people whose circumstances require assistance. It is unfortunate that so many officers have been withdrawn. We know the reason for it, the absorption of so many non-contributory pensioners by the contributory scheme. Nevertheless, I think it is a retrograde step. It would be a helpful thing if there were better liaison between these officers and the local sub-committees. I do not know why these officers cannot attend the local sub-committee meetings and confer with these members of the community who in this day and age are prepared to devote their time to looking after the interests of their less fortunate neighbours.

There is another point to which I have referred on previous occasions and to which I should again like to refer. It is the anomaly of a transferred farm to a son or daughter being recognised at a certain valuation for the purpose of obtaining the old age pension. This incentive exists and is helpful in encouraging people to give over their farms at a particular age and transfer the ownership to more active members of their family. We have cases, however, of childless couples adopting a niece or nephew at a young age. Their children give their time without recompense in the hope of becoming owners of the farm at some stage. In those instances the transfer is not recognised for the purpose of the Social Welfare Act. I would ask the Minister to look at that situation and I would impress on him that these people are as deserving of recognition as the closer relatives.

It is usual for members of the Labour Party when speaking in this debate each year to draw attention to the fact that, in the opinion of the Party members, the benefits under the various headings are altogether inadequate. It is just as usual for the reply to come back from the Government benches that they are giving all that is economically possible to give them, or for the reply to be in the form of the sally: "What did you do when Corish was Minister?" I hope the Minister will listen to this debate in a different spirit. In fact, I hope to forestall both those answers during the course of my remarks. In connection with the statement that those in receipt of State benefits under the social welfare code are getting all that the economy of the country can afford, I suggest to the Minister that if he looks at the figures for tax revenue versus social welfare benefits, and the proportion of social welfare benefits which includes national assistance and national insurance plus administration and studies, the expenditure vis-à-vis tax revenue from the year 1957-58 up to the present, he will find that there has been a gradual decline in the proportion of money allocated to these people, who, in my opinion, are the most deserving in the State.

In the year 1957-58 tax revenue was £102.7 million and social welfare expenditure was £25.5 million. That, expressed as a percentage, is 24.8. In 1958-59, tax revenue rose to £104.1 million and social welfare benefits decreased from £25.5 million to £25.4 million and the percentage declined to 24.4. The year 1959-60 shows a further decline. There was an increase in tax revenue up to £107.3 million and social welfare expenditure was £25.5 million, representing 23.8 per cent. That is a continuous decrease. In 1961-62 and up to 1963, there was a similar decline so that in 1962-63, when tax revenue was £136 million, social welfare expenditure was £27.1 million, that is, 19.8 per cent. of the tax revenue. To put it another way, between 1958 and 1962, there was an increase of £32 million in tax revenue and of this increase, less than £2 million increase was given to social welfare recipients.

I suggest that that debunks the claim that the social welfare group are getting all that it is economically possible to give them in present circumstances. I would further suggest that in view of the increased contributions being paid by the ordinary workers throughout the country not only did the increased contributions pay for the increase in contributory benefits given to those who qualified for them, but that the Minister's Department made a handsome profit on the deal. I would further suggest that not only the Minister's Department but several other institutions in the State made considerable gains out of the provision of contributory pensions.

Take the case of a single old age pensioner. Prior to the increased contributions, and prior to the benefits being increased to £2 a week, he was in receipt of 30/- a week old age pension. If he had been entitled to a special allowance for IRA services, he had a varied sum of money, depending on his means, up to perhaps £2 a week. As well as that, he was probably entitled to free turf and, in addition, he was very likely in receipt of a disability benefit or home assistance from his local authority. Immediately his pension was increased, his IRA pension and his special allowance were similarly decreased. His home assistance was cut off and he was deprived of the right to free turf under the free fuel scheme. I suggest to the Minister that, on the whole, not only did the State not give out anything extra but that it actually gained by the introduction of that much lauded improvement in social welfare.

Again, I would suggest, to deal with the catch cry "Why did Corish not give more than 2/6d.?", that while it is true that in 1955 the inter-Party Government increased old age pensions and other non-contributory pensions by 2/6d., that 2/6d. in 1955 cannot be compared with the 2/6d. increase given last August. In 1955, the cost of living was much different from what it is in 1962.

I should like to read for the benefit of the Minister some figures of the variations in prices since 1955. In May, 1955, butter cost 3/9d. per lb. and in mid-May, 1962, it cost 4/7d. Milk cost 5d. a pint; it now costs 6½d. a pint. A 2 lb. loaf cost 9d. then; it now costs 1/4d. There was an increase of practically 100 per cent. in the price of flour, from 4/2¼d. per stone to 8/3d. per stone. Tea cost 4/11¾d. then; it now costs 6/2½ per lb. There have been increases in other items which go to make up the cost of living index figure. In respect of clothing, the figure stood at 100.2 in 1955; it is now at 109.4. The fuel and light figure was 103.2; it is now 119.8. Housing was 105.6; it is now 131.8. Those are substantial increases which have had the effect of devaluing the present 2/6d. as against the 2/6d. given in 1955.

Not only is it desirable to give an increase in social welfare benefits to people who, through no fault of their own, have the misfortune to have to try to exist on State aid, but it is desirable to give such an increase also because we are contemplating entering the European Common Market. It may be thought that the question of the Common Market is a far cry from social welfare benefits in Ireland, but I suggest there is a very close connection between the two. I was looking up some figures in page 2 of the September issue of the magazine Trade Union Information. In it there is a report of a sub-committee of the National Employer-Labour Conference under the heading “Common Market”. I quote from the magazine:

One of the Sub-Committees set up by the National Employer-Labour Conference, 1962, studied the possible repercussions on labour relations and social policy in the event of Ireland joining the Common Market. Among the matters on which the Sub-Committee reported to the plenary session of the conference held on 11th July were labour costs, productivity trends, hours of work, paid holidays and social security. The following are extracts from the report of the Sub-Committee dealing with these matters.

It goes on to give a long account, but I should like to quote what I regard as the important parts of the report. Under the heading "Labour Costs", it says:

In particular, any comparisons with continental countries must take account of the incidence of social charges borne by employers which in some cases represent a high proportion of wages.

It then goes on to give figures for the average hourly labour costs in manufacturing industry, taking April, 1959, as the only year in which full details were available. The table shows that in the United States, yearly earnings amounted to 15/10d. per head, to which was added a figure of 3/2d. for social security benefits giving a total figure of 19/-. In Sweden, the figures were 6/8d. with 1/- added, making a total of 7/8d.; in Germany, 3/10d., with 1/9d. added, giving 5/7d.; in Switzerland, 4/9d., with 9d. added, giving 5/6d.; in the United Kingdom, 4/10d., with 8d. added, giving 5/6d.; in Belgium, 4/-, with 1/3d. added, giving 5/3d.; in France, 3/4d., with 1/9d. added, giving 5/1d.; in Italy 2/6d., with 1/10d. added, giving 4/4d.; and in the Netherlands, 3/2d., with 1/11d. added, giving 5/1d.

It is true to say that no figures are available for Ireland because Ireland did not come under review in this report. However, I quote again from the same paper:

Figures for Ireland were not included in the French study. It has been estimated, however, that a roughly corresponding figure here for average hourly labour costs in manufacturing industry in March, 1959, was approximately 3s. 5d. of which social charges accounted for about 4½d. This estimate is a very rough approximation only and the resulting position of Ireland in the table of labour costs should, therefore, be interpreted with caution. It would appear, however, that hourly labour costs here were somewhat less than in the Netherlands and Italy, but appreciably below the other Common Market countries and the United Kingdom.

Is it likely that the Common Market countries will fall over themselves to welcome into their fold a country whose average rates of earnings in industry are so low as to place those countries in an unfavourable competitive position vis-à-vis Ireland?

That does not seem to arise on this Estimate, which deals with Social Welfare.

With respect, Sir, I am endeavouring to prove that if the figure of earnings, plus social welfare benefits, in Ireland is so low, we will be in a position that the countries of the Common Market will have to insist that we get out of it altogether or that our social welfare benefits be increased to the level of theirs so that we will not have an unfair trading advantage over them.

Increases in social welfare benefits would require legislation and, as the Deputy is aware, it is not in order to advocate legislation on Estimates.

I am passing from it anyway, Sir. I agree that increases in social welfare benefits would require legislation, but surely it does not require legislation to tell the Minister that the existing benefits are too low and that legislation should be introduced to improve them?

We have heard the Taoiseach and various Ministers saying that in the Common Market the Border will melt away. But is it likely that will happen? Social welfare benefits in Northern Ireland are considerably better than in the 26 Counties. I should like to take a simple example. A husband and wife in Northern Ireland get £4 15s. 6d. national assistance, which corresponds to unemployment assistance here. All they would get here would be £2 2s. 6d. in urban areas and £1 14s. 6d. in rural areas. Surely it is most unlikely that anyone in Northern Ireland, be he Unionist or Nationalist, would be prepared to relinquish his rights to these benefits, which are so much better compared with ours? Is it not reasonable, if we are serious in our efforts to unite this country, that one of the first and most vital steps is to bring up our social benefits to correspond, so far as is humanly possible, with those in Britain? I am not foolish enough to think it possible for us to go the full way but I suggest the difference between us is of vital importance.

One small matter to which I have already drawn the attention of the Minister's Department is this. I should like the Minister to investigate a report I received in my constituency a couple of weeks ago in which it was claimed by Irish sailors resident in Ireland but working on British ships that when they receive an injury in the course of their employment, because they were using Irish insurance stamps—they were insured in Ireland under our social welfare code—they were not eligible for workmen's compensation. One of those, after three or four weeks' illness, got no workmen's compensation, although admittedly he was injured in his employer's work on the high seas and applied to the Department of Social Welfare here as a substitute. All he got was a reply stating that in view of the fact that he was at his work when the injury occurred, the Department had no responsibility.

Progress reported; Committee to sit again.
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