Dáil Éireann debate -
Thursday, 27 Feb 1964

Vol. 207 No. 13

Committee on Finance. - Vote 50—Social Insurance.

Minister for Social Welfare (Mr. Boland)

Tairgim:

Go ndeonófar suim fhorlíontach nach mó ná £875,000 chun íoctha an mhuirir a thiocfaidh chun bheith iníoctha i rith na bliana dar críoch an 31ú lá de Mhárta, 1964, le haghaidh íocaíochtaí leis an gCiste Árachais Sóisialta.

Tá dhá Mheastachán Fhorlíontach ós comhair na Dála le h-aghaidh seirbhísí mo Roinne-se don bhliain 1963-64, agus tá súil agam ná cuirfidh éinne i gcoinne iad a thógaint le chéile mar is gnách.

Sa Mheastachán i leith Árachais Shóisialaigh táthar ag lorg £875,000 sa bhreis, agus sa Mheastachán i leith Cúnaimh Shóisialaigh, £1,651,000 sa bhreis. 'Séard is príomh-chúis leis na Meastacháin Fhorlíontacha ná na méadaithe i rátaí árachais shóisialaigh a tháinig í bhfeidhm i dtosach mí Eanáir, agus na méadaithe i rátaí cúnaimh shóisialaigh a tháinig i bhfeidhm i dtosach mí na Samhna seo chaite.

I gcás Vóta 50—Árachas Sóisialach —meastar go mbeidh breis chaiteachais de £880,000 faoi Fho-Mhírcheann A agus spáráil de £5,000 faoi Fho-Mhírcheann B. Mar sin tá suim ghlan de £875,000 de dhíth. Tá £662,500 de dhíth chun íoc as costas na bhfeabhsanna a rinneadh ins na scéimeanna árachais. In a theannta san meastar go mbeidh breis chaiteachais de £831,000 sa bhliain seo toisc líon na n-éilitheoirí a bheith ag dul i méad. Táthar ag súil ar ndóigh le breis ioncaim toisc gur ardaíodh rátaí ranníocaíochtaí ó thosach mí Eanáir. Nuair a cuirtear an bhreis ioncaim agus mion-athruithe eile san áireamh 'sé £875,000 an tsuim bhreise atá ag teastáil.

I gcás Cúnaimh Shóisialaigh 'sé an tsuim ghlan atá de dhíth ná £1,651,000. 'Sé costas iomlán na méadaithe i rátaí cúnaimh shóisialaigh sa bhliain seo ná £1,687,000. Tá mion-athruithe eile nach mór a chur san áireamh agus dá mbárr siúd 'sé £1,651,000 an tsuim ghlan atáthar ag lorg sa Mheastachán seo.

There are two Supplementary Estimates for my Department for the current financial year, and I propose with the permission of the Ceann Comhairle and of the House to take both together.

The Estimates, and the amounts required to be voted are—

	£
Social Insurance	875,000
and
Social Assistance	1,651,000

The need for the Estimate in each case arises primarily from the Social Welfare (Miscellaneous Provisions) Act, 1963, which increased various rates of insurance benefits with effect from the beginning of January, 1964, and various rates of assistance payments as from the beginning of November, 1963, and also affected other improvements in both the insurance and the assistance services.

The additional sum of £875,000 required for the Social Insurance Vote for 1963-64 is the net result of an estimated excess of £880,000 on the original Subhead A provision, offset by a small saving of £5,000 on Subhead B.

As Deputies are aware, Subhead A of the Social Insurance Vote provides 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 any year. The amount now estimated for 1963-64 is £8,862,000, an increase of £880,000 on the original provision of £7,982,000, for the year.

The cost of the increases in rates of benefit and other improvements is estimated at £662,500 in the quarter ending 31st March, 1964, the figures for individual services being as follows:—

	£
Disability Benefit	214,000
Maternity Allowance	2,500
Old Age Contributory Pension	165,000
Unemployment Benefit	148,000
Widow's Contributory Pension	133,000
Total	£662,500

Other increases in expenditure in 1963-64, attributable mainly to an upward trend in the numbers of claimants and an increase in average duration of disability claims, are estimated to require additional provision in the current year amounting to a net sum of £831,000, of which disability benefit accounts for £590,000.

Taking into account an increase of £36,000 in administration costs, the total additional expenditure to be provided for in the current year accordingly amounts to £1,529,500. This is offset, however, by an estimated net surplus of £522,000 on the income side. The principal single item in this surplus is an expected increase of £425,000 in employment contributions, of which £300,000 is attributable to the increase in the contribution rates which took effect from 6th January, 1964, and the balance is due to favourable trends in the employment position generally.

There is a further offset of £127,500 representing the amount overdrawn by the Social Insurance Fund from the Exchequer in 1962-63. The net supplementary provision required for Subhead. A is therefore £880,000. Taking into account the saving of £5,000 on Subhead B, the total Supplementary Estimate for Social Insurance becomes £875,000.

As regards Social Assistance, the additional sum required for 1963-64 is estimated at £1,651,000. This is the net figure resulting from increases on Subheads A, B, C and D totalling £1,674,000 onset by savings on other Subheads amounting to £23,000.

The Social Welfare (Miscellaneous Provisions) Act, 1963, increased the rates of old age and blind pensions, widows' non-contributory pensions and unemployment assistance from the first week of November, 1963, extended the children's allowances scheme to families with one qualified child and increased the rates for the third and each subsequent child and effected other improvements in the assistance services.

The cost of these increases and improvements in the current year is estimated at £1,687,000 made up as follows:—

	£
Old Age and Blind Pensions	318,000
Children's Allowances	1,208,000
Unemployment Assistance	92,000
Widows' Non-Contributory Pensions	69,000
Total	£1,687,000

This total needs to be adjusted in the light of other factors. In the case of old age pensions and widows' non-contributory pensions, there are savings, estimated at £102,000, on the original provision due to a slight decrease in the expected number of pensioners, while there are estimated excesses amounting to £89,000 on the original provisions for children's allowances and unemployment assistance because of an upward trend in the number of recipients. Minor savings on other subheads amount to £23,000. The effect of these adjustments is that the net additional sum required for Social Assistance is £1,651,000.

Mr. O'Sullivan

We commend to the House the adoption of the Supplementary Estimates for Social Insurance and Social Assistance as the necessity for providing this section of the community with the benefits the State has decided are necessary to meet the obligations of the day is only too apparent to all Deputies.

Regarding the presentation of the Estimates under the Minister's responsibility, I wonder if he has considered the report of the Committee on Public Accounts just published where, in paragraph 38, they recommend to the Minister that, because there is such a close link between the services provided under these Votes—Social Welfare, Social Insurance and Social Assistance—they should be combined? They consider that there would be no diminution of financial control by such a combination. We have streamlined some of our Estimates in an effort more expeditiously to dispose of Parliamentary business and also to provide for more clear discussion on the Departments of the various Ministers.

I should like to know the Minister's reaction to this important recommendation by such an important body. Rarely does this Committee give advice to any Government or Minister which has not been fully and comprehensively considered by the members in conjunction with the officers of the various Departments before being arrived at. It would be well if the Minister would give an indication of his reactions to this particular recommendation as I am sure sufficient time has elapsed since he received it for him to arrive at some decision.

I note that in this Supplementary Estimate we have a sum of £36,000 for increases in administrative costs. To our knowledge, there has been a laying off of personnel in the rural parts of the country under the authority of the Minister. Surely the reason for dispensing with such posts was the economic reason and consequently one would expect that there should be some saving on the administrative side. If we have an expansion in the costs of administration, one can assume that the officers of the Minister's Department will respond to the admonitions so frequently given by the Minister's leader to those in private concerns relative to giving some suitable reward for work done.

My experience has been that never has it been so difficult to obtain a decision from the Department of Social Welfare. I have been a member of this House for about 15 years and I cannot recall any year in that time when it took longer for the Minister's Department to arrive at a decision. That is taking into account the fact that it is now a separate Ministry. For many years, the Minister responsible for the Department of Social Welfare was also responsible for another important Department. This Minister is responsible only for the Department of Social Welfare and yet the number of instances in which people cannot receive a reply from the Department at all is appalling.

When people do make representations to the Department, as they are entitled to do, these appalling delays occur. I know instances where cases under appeal were solved by a far greater power than any exercised by the humble members of this House, where people have been called to their eternal reward within the protracted period of re-examination. It would be well if we had an allaying of the public disquiet which is evidenced by many of the letters recently written to the newspapers about the long delays in these matters. As Deputies, we are inundated with letters and complaints about these delays. I should like to get from the Minister some explanation of the delays and some indication that they will be rectified very soon. We are dealing with a class of people to whom Providence will not give the time to wait for a decision. It is a matter of grievous concern to these people whose benefits are withheld pending these decisions.

An Ceann Comhairle

I wonder does that matter arise on this Estimate?

Mr. O'Sullivan

It arises under the heading of £36,000 for additional costs in administration. At this time, the Minister is participating with his colleagues in the preparation of proposals for the improvement of the lot of the many people dependent on the activities of his Department. I wish to make a plea for the inclusion of a class who are at present in a pitiable plight due to the fall in the value of money and the increase in the cost of living—spinsters of 65 years of age who have no other means.

If we persist in levying taxation on all the necessaries of life, we should return to these people at least sufficient to enable them to combat the increase in the cost of living. I want to know whether it has been brought to the knowledge of the Minister that there will be an increase in the cost of living which was not taken into account at the time this Supplementary Estimate was prepared and whether there are any proposals for additional awards to these people to enable them to combat the increase in the cost of living. In recent weeks, it has been projected through Radio Éireann that there are some people in this country who have grapefruit and yoghourt for breakfast. Not many of the people catered for in these Estimates are in that happy situation. They depend on bread, butter, tea and sugar for the main elements of their diet.

These people know that they had to pay a penny extra last week for the loaf of bread. The bakers have now been notified that there is to be an increase of 4/- in the price of flour which may entail an additional penny on the loaf of bread in the next week. That will be the second increase in the price of bread since the people had an opportunity of expressing their opinion a short time ago. I want to know if the benefits for which we are now providing the money are sufficient to meet these additional imposts on the poorer sections of our community.

There was a reference in the Minister's speech to a decrease in the expected number of pensioners under the non-contributory heading. Is this the effect of a more stringent application of the means test? We have had another Minister telling us that our people are living longer although perhaps they only feel that they are living longer because they are finding it so difficult to live at all. It is true that due to advances in medical science, people are living longer and so one would expect that there would be a greater number of non-contributory pensions. Nevertheless, the Minister states that there is a slight decrease in the expected number. I want to know if that is being achieved by a more stringent application of the means test. If it is, I consider it most unjust.

We have a complete admission that money values have fallen so much that it is essential that those sections of our community who are in receipt of these benefits should get an increase in their amounts to compensate for the fall in the value of money. If the Minister persists in this strict application of the means test, as indicated by his expectation of a reduced number of qualifying persons, it must be remembered that the level of income of these people was fixed at a time when money had some value, before the deliberately inspired spiralling of the cost of living. That fact must be remembered in applying the means test and some consideration must be given to the fact that what was originally defined as the limit is completely outdated by what has happened in the meantime. Instead of there being an easing in the application of the means test in relation to these persons, the Minister forecasts a reduction in the number of persons qualifying.

Also, in relation to unemployment assistance, would the Minister explain the reason for the upward trend in the number of recipients, which would not seem to be in accord with some of the statements contained in his introductory speech? The Minister has recorded an additional sum of £425,000 from employers' contributions in relation to one of his Estimates but is he aware that this charge is merely one of several which are being unloaded on to the shoulders of the consumer, like rate increases and many other increases that certain members of the business community have to contend with. When these increases are levied there is no assurance that the money will come directly from the pockets of the people concerned as employers. There are too many indications of the effective transference of such impositions to the shoulders of the recipients, the supposed beneficiaries, of those increases. It is desirable, in the conduct of the finances of the State to ensure that this practice be brought to an end. Instead, it is gaining momentum daily. It is a matter which will entail for everybody a considerable reduction in the value of whatever income he may have, whether it is from direct earnings in employment or the assistance which the State can afford to give to those who are unfortunate enough to be unable by their own efforts to provide for themselves.

It is in these circumstances that we examine these Supplementary Estimates. We agree to them as being necessary but we must express grave concern at the fact that because of policies that have been pursued in recent years, pursued in defiance of warnings issued from these benches and elsewhere as to what would happen if the Government were to continue the policies which they were operating, the supposed benefits that recipients of social welfare payments would derive, have been considerably reduced by cost of living increases.

Today it would appear that there is complacency and satisfaction among the front bench members of the Government regarding the cost of living figures but these figures are of grave concern to those persons who rely on these payments, which give them a relatively low level of income. We want some assurance from somebody that some effective action is being taken to protect these people. Everybody is aware and must admit that the Government could have secured, if they had available to them the increases that have been imposed on luxury items alone over the past 12 months——

An Leas-Cheann Comhairle

The Deputy seems to be travelling very far on this Estimate, which deals with social welfare services.

Mr. O'Sullivan

I am referring to the reduction in value of the amount that was decided as being sufficient for this class in the community and the need to ensure that what they get will leave them in a position to provide the necessaries of life. In that respect we are not satisfied. We feel that while it is projected that they are getting a particular sum, there is no effort being made to guarantee that what can be purchased by way of necessaries of life for that particular pittance will be sufficient to guarantee to these persons who are dependent on the community that level of subsistence which is vital for the survival of themselves and their families.

It is in these circumstances that we agree to this Supplementary Estimate but we must express regret that the cost of living has been permitted to vitiate the alleged improvements provided for these categories.

Mr. Tully

The Labour Party also support the Estimate. I am glad to say that my experience in dealing with the Department of Social Welfare has not been the same as Deputy O'Sullivan's. As far as the officials of the Department and the Minister's officers are concerned, I have found them most courteous and obliging and prepared to do everything they possibly can in order to try to get matters which I complain of dealt with speedily.

Having said that, however, I would agree with Deputy O'Sullivan that for some unknown reason there have been very prolonged delays in dealing with certain types of cases, appeals, particularly unemployment benefit appeals, disability benefit appeals and pension appeals. The Minister possibly might find out if there are enough officers dealing with these matters because, while, as I have said, I meet with the greatest courtesy from the people to whom I have made representations or from whom I have made inquiries, very often they tell me that there will not be an appeals officer in the district concerned for some considerable time. That is of very little use to the person who is depending on social welfare benefit for his livelihood. It is just too bad that the convenience of some Departmental official must take precedence over his right to a benefit in respect of which he has been paying over a number of years. Obviously, there is a regulation which governs the way these matters are dealt with and which the Minister can alter. I would ask the Minister to consider that matter. It is too bad that the regulations should be working out in that way.

The Minister might be able to tell me if his recent decision to increase the period for which the average test must be satisfied for contributory old age pension from 15 to 20 years has had much impact. Would he have any idea as to the approximate number of persons who have qualified as a result? I should like to tell the Minister at this stage that I am grateful to him for the effort he has made to have this increase in the qualifying period put into operation. I still think he could have gone a good deal further because while it has been said that the Departmental records are not such as to show evidence of insurance of insured persons back further than perhaps 15 or 20 years, I was able— and others have been able—to get insurance records back to the early twenties, on application. I think if the Minister so decided, these back records could be obtained just as easily.

The Minister told me he proposed to consider the dependants of old age pensioners. Strange as it may seem, there are quite a considerable number qualified for pensions who have children and it is too bad if those people have been working and drawing disability benefit or unemployment benefit until the age of 70 and, while doing so, have been receiving children's allowances in accordance with their entitlement and on reaching 70 years get the old age pension for themselves and a wife, if the wife is alive, and nothing for the children. I discussed this with the Minister in the House and privately and I understood he was favourably disposed to doing something about it. I have not heard of anything being done yet and I should like the Minister to refer to it when replying.

I am rather intrigued by his statement that:

The principal single item in this surplus is an expected increase of £425,000 in employment contributions, of which £300,000 is attributable to the increase in the contribution rates which took effect from 6th January, 1964, and the balance is due to favourable trends in the employment position generally.

Is the Minister really serious when he makes that statement because the figures published by his Department do not bear that out? They show, in fact, that there appears to be no appreciable increase in the number of insured persons. I can understand that the increase in contributions has affected the total but I should like to know if the Minister can give us any definite figures as to the extra number who, as a result of being employed, are paying insurance and have helped to reach this sum because I have been unable to find any evidence of that. Incidentally, it is rather unfortunate that it appears that the number employed is less than it was some years ago. That is something we all deplore. I am not blaming the Minister for the situation but if the position is as I say, the opposite should not be stated in his opening speech.

This total needs to be adjusted in the light of other factors. In the case of old age pensions and widows' non-contributory pensions there are savings, estimated at £102,000, on the original provision due to a slight decrease in the expected number of pensioners, while there are estimated excesses amounting to £89,000 on the original provisions for children's allowances and unemployment assistance because of an upward trend in the number of recipients.

We all know, if we know anything at all about social welfare benefits and assistance, that people on unemployment assistance are people who have exhausted their right to unemployment benefit and if the upward trend in unemployment assistance is there it means we have a bigger number of people who have been unemployed for periods longer than six months. That is a very serious situation and I should like the Minister, if he has time when replying, to make a comment on it because to me it seems to be contradictory of what appears earlier in his statement.

I want to make some brief remarks about a matter which Deputy O'Sullivan referred to, the question of the change in social welfare offices in certain districts and which has occurred in Meath constituency also. While there is a certain amount of local agitation and while I have asked the Minister to meet a deputation consisting of another Meath Deputy, a Senator and myself to discuss this matter—he has agreed to meet us—I feel it is not as serious as some people make out. If I know the regulations, the office which has been closed down is the office in which the person who carries out investigations was located. That person's job was to carry out investigations on the spot, not in an office and if somebody wants his services or if he himself feels he needs certain information, it is his job to go out to the insured person or the person drawing assistance and not ask him to hire cars, go on buses or travel miles to see him. I think I am stating the position fairly but in view of the fact that there has been so much agitation, I wonder would the Minister say whether or not there are circumstances which would require having an office for even one day a week or a month during which certain people could see him.

I am perfectly convinced that no hardship is being done to the people who are being looked after—if that is the right phrase—by this particular official but in case there is something in it which I do not know and which the Minister might consider should be explained, perhaps he would comment on it when replying. I should like to know if there is something of which I am not aware that would require the office being kept open full-time.

I have no further comment to make, except to say that I am very grateful to the Minister, his Department and officials for the courtesy they have shown me during the past 12 months.

Mr. Boland

There is little need to do much more than thank the House for dealing with the Supplementary Estimate so expeditiously but some points were raised which call for reply. First, I should like to tell Deputy O'Sullivan that the recommendation made by the Committee of Public Accounts has been accepted and that in future it is intended to have only one Estimate for Social Welfare and to combine both insurance and assistance in that.

The Deputy mentioned that there was provision here for £36,000 due to increases in administration costs. That is not due to the fact that there has been any extra expenditure in this year on administration. The extra amount arises as a result of adjustments for underclaims in respect of administration which is proper to the previous year, 1962-63. It is divided as between, Posts and Telegraphs, £26,000; Office of Public Works, £7,000 and the Stationery Office, £3,000. These other Government Departments submitted claims for the previous year which were subsequently found to have been too small and the £36,000 is for those adjustments in this year.

I was surprised to hear Deputy O'Sullivan claim that the position in regard to delays in dealing with claims and appeals was never worse than now. The experience of my Department is that the position has improved considerably and that there are not now long delays in dealing with claims or appeals. There may be exceptional cases in which delays do occur but there is usually some very good explanation for any such case. If Deputies would bring to my notice any case in which there has been excessive delay, I shall have it investigated and indicate why that has been so. If necessary, I shall take whatever remedial action is required. Certainly my experience has been that the position has improved considerably.

It is not correct to suggest that there is a too stringent application of the means test in regard to the non-contributory old age pension and that this is resulting in a decrease in the number of recipients. In fact, in the two years since I became Minister for Social Welfare, the means limit for old age pensions has been extended in each year. So far as that is concerned, the only effect has been to bring in more people for the lower rates of pensions.

The fact that there are savings in the non-contributory old age pensions is not due to a decrease in the expected number of pensioners but means simply that there was an over-estimation last year. Another factor that has contributed to it is the matter to which Deputy Tully referred, that the period over which contributions qualifying for contributory old age pensions can be counted has been extended from 15 years to 20 years. Deputy Tully asked how many new pensions had been granted as a result of that. So far, 600 new contributory old age pensions have been granted and I dare say that a considerable number of those had previously been in receipt of non-contributory old age pensions. Certainly there is not a more stringent application of the means test. Most rural Deputies will agree that now the transfer of land by a person who has reached the age of 70 is accepted almost automatically where previously it was not.

Mr. Tully

Natural love and affection do not come into it now.

Mr. Boland

No; it is more or less generally accepted that a person on reaching the age of 70 is not physically capable of working a farm. It is also assumed that a son or daughter or other relative would not be prepared to remain and work the farm for him unless he or she has control of the farm.

Mr. O'Sullivan

What about the transfer of a farm to a nephew or niece?

Mr. Boland

Yes, it is almost automatically accepted and that was not the position previously. Therefore, I do not think there is any substance in the claim that the means test is being applied more stringently now.

Deputy Tully raised a point about making provision in the contributory or non-contributory old age pensions for dependent children of pensioners. I fully recognise that it is anomalous that it is only in the old age pension schemes that there is no such provision while all the other social welfare schemes do take account of child dependents. It will require legislation and nothing has been done so far. Strange as it may seem, this will cost a considerable amount, but, as I told Deputy Tully, it is one of the things I have in mind and provided the financial situation allows, I intend to make that provision. It is an obvious development of these schemes that should take place to bring them into line with the other social welfare schemes.

In regard to the closing of a number of social welfare offices throughout the country, I think Deputy Tully appreciates the position very well. These were just offices in which the social welfare officer was accommodated. His work is mainly field work and consists, in the main, of investigating claims. It is not true to suggest that the public have been caused any inconvenience because of the closing of these offices. The complaints that have been made from urban district councils and so on, about the closing of these offices have to do rather with the question of the status given to the town by the location of Government offices there than any question of inconvenience.

Mr. Tully

The labour exchanges are still there.

Mr. Boland

The labour exchanges are still there and the people can get any information they require there but the social welfare officer was never expected to be regularly available to the public in his office as his job is to go around investigating claims expeditiously.

Mr. Tully

Had he any right to send for people to be interviewed in his office?

Mr. Boland

No, that was not supposed to happen and is not supposed to happen.

I dealt with the question of these savings mentioned in the last paragraph of my opening statement in so far as non-contributory old age pensions were concerned. In regard to the widows' non-contributory pensions, it has been a feature that the number of recipients falls each year. That is because a bigger proportion are becoming eligible for contributory pensions and we under-estimated what the fall would be in this year.

In regard to the estimated excess of £89,000 in the provision for children's allowances and unemployment assistance, only £35,000 of that is due to the upward trend in unemployment assistance. In that respect every time there is an increase in the rates of unemployment assistance, due to the new methods introduced last year for deciding the means limit for a qualification certificate, then automatically that means limit is raised and more people can qualify for unemployment assistance.

At the outset, I made a statement that there was an improvement in the employment position and that some of the £425,000 of the expected increase in employment contributions was due to the favourable trends in the employment position. That is a factual statement and there is only £300,000 of the total attributable to the increased rates of contribution. The remaining £125,000 is due to the fact that more people are in insurable employment. I do not think there were any other points raised and I thank the House for dealing so expeditiously with this Estimate.

Vote put and agreed to.