Dáil Éireann debate -
Tuesday, 21 Nov 1972

Vol. 263 No. 11

Social Welfare (Pay-Related Benefit) Bill, 1972: Second Stage.

Minister for Social Welfare (Mr. J. Brennan)

I move: That the Bill be now read a Second Time.

The introduction of this measure represents a further significant step forward in the development of our social insurance system. It is designed to make adequate provision against loss of income by insured workers and their families during periods of sickness or unemployment. As Deputies are aware, the loss of income suffered by a person during periods of sickness and unemployment has up to now been catered for by payment of flat rate benefits. Down the years these benefits have been regularly improved not only in the matter of provision for dependants and in duration of payment but also in the levels of payment which have been increased at a rate very considerably greater than the rate of increases in the cost of living. The main defect in these flat rate benefits is that they are not flexible enough and cannot be adjusted or shaped to provide adequately for the different needs of persons who, when working, had not the same levels of earnings and, as a result, had widely differing financial commitments related to their levels of earnings.

In many cases, particularly at higher pay levels, the rates of benefit are not sufficiently high to enable insured persons to maintain anything approaching their accustomed standard of living during longer periods of sickness or unemployment. To increase the flat rate benefits to a level which might be regarded as adequate for the higher paid workers would, however, require such an increase in the contribution rates that these would be a heavy burden on the lower paid worker. Further, very high flat rate benefits could have the undesirable effect of giving lower paid workers, when unemployed, such a high proportion of their wages as to deter them from seeking work. The purpose of this Bill is, therefore, to improve the position in this respect by relating both benefit and contributions to earnings to some degree and to provide rates of benefit which will better enable persons to maintain, during sickness and unemployment, a standard of living reasonably close to that to which they have been accustomed.

Although, as I have said, this Bill is a significant step forward in the development of our social insurance system, I am fully aware that there is nothing very novel in the idea of pay-related benefit. It is a feature of the social insurance schemes in one form or another of many countries including Britain and it has been my intention for some time to introduce such a scheme here. In the Third Programme for Economic and Social Development it was included among the social insurance schemes scheduled for introduction but, for reasons which I shall explain, it has only now become a practical proposition.

The main problems in setting up a scheme of pay-related benefit are the collection of contributions based on pay and the obtaining of accurate, reliable, and readily accessible information as to annual income on which to calculate the benefit. It is essential for the purposes of such a scheme that the earnings of persons covered should be fully and clearly recorded and readily accessible for the purposes of both collection of contributions and payment of benefit. In the PAYE and associated methods of collecting income tax from employees the Revenue Commissioners have machinery under which accurate records are available of the earnings of the majority of persons employed in this country. Some classes of employees are not included, however, and I will refer to these later.

If the machinery of the income tax collection system were not to be made available for the purposes of this pay-related social insurance scheme, then a separate system of collection and of record-keeping would have to be set up by my Department for these purposes. Such a procedure would be an unnecessary duplication of work in the public service and would place an intolerable burden on employers by requiring them to furnish the same information twice. It would have been feasible but it would have been costly and involved further delay as it would have entailed the setting up of a separate computer installation in my Department for which not only special accommodation would have to be provided but also additional specially trained staff.

Some work was, in fact, done in this connection but this only brought out more clearly the magnitude of the problems a separate installation would involve and the extent of the extra burden which would have been placed on employers. The setting up of a separate Departmental computer installation for the purposes of this particular scheme was not therefore considered a reasonable alternative to using the income tax collection system for the purposes of a pay-related benefit scheme. However, as the Revenue Commissioners themselves have only recently reached the position where they could undertake the collecting of pay-related contributions and, at the same time, furnish the information needed to pay benefit, it has only now become possible to introduce the pay-related benefit scheme provided for in this Bill.

The scheme of pay-related benefit in this Bill is designed to provide a new benefit, under the social insurance system, which will supplement unemployment benefit in the case of unemployment and disability benefit and maternity allowance in the case of incapacity for work. A person who is entitled to disability benefit may, because his incapacity is due to an accident at work or a specified occupational disease, be in receipt of injury benefit under the occupational injuries scheme in lieu of disability benefit and it is intended that pay-related benefit will be payable in such a case also so long as the person involved has an underlying entitlement to disability benefit.

The existing flat rate benefits mentioned, including amounts for adult and child dependants, will continue to be payable under the same conditions as at present. Where, however, the incapacity for work or unemployment lasts for longer than a fortnight, the flat rate benefit will be supplemented by pay-related benefit, which will be at the rate of 40 per cent of that part of the claimant's average weekly earnings, in a previous income tax year, which lies between £14 and an upper limit or ceiling, yet to be fixed.

The average weekly earnings of all industrial workers in the quarter ended 30th June, 1972, was approximately £23. A single person earning this amount will receive £3.60 by way of pay-related benefit, plus £5.55 by way of disability or unemployment benefit, making a total weekly benefit payment of £9.15. A married man earning £23 will receive total weekly benefit of £12.90 if he has no dependent children, £15.60 if he has two children and £18.60 if he has five children. The average weekly earnings of adult male industrial workers in the same period was almost £30. Under the new provisions a single man in this category will receive £11.95 total weekly benefit. A married man will get £15.70 if he has no dependent children, £18.40 if he has two children and £21.40 if he has five children.

I should explain that the 40 per cent level was chosen after an examination of the real value of various levels of pay-related benefit in terms of replacement of net pay lost during periods of sickness or unemployment. Very few workers take home the full amount of their pay. Stoppages of various kinds are almost invariably made and these include statutory deduction in respect of social insurance contributions and income tax. These statutory deductions, which arise out of payment of remuneration, are not made during weeks of unemployment or sickness so that during such weeks income replacement by way of benefit need not take the amount of the deductions into consideration but should properly relate only to the person's net or take home pay. As I have indicated the main purpose of having benefits related to pay is to enable the recipient to maintain, during periods when he is not at work, a standard of living reasonably comparable to that which he normally enjoys. Children's allowances, where payable, are part of the family income and are paid whether the beneficiary is earning or sick or unemployed, and it is reasonable to add these payments both to the level of take home pay and to the level of benefit in determining the real value of the pay-related benefit in maintaining the beneficiary's standard of living.

The 40 per cent of reckonable earnings in excess of £14, when added to the flat rate benefit payable, provides in the case of single persons, replacement of at least 50 per cent of net pay at all pay levels while, in the case of married persons, the level of replacement is higher because of the addition of increases of flat rate benefit in respect of dependants. The level of replacement of net pay, for example, at average weekly earnings of £30 would be approximately 65 per cent for a married man, 70 per cent for a married man with two children, and 75 per cent for a married man with four children. At earnings of £20 the level of replacement would be higher still, being 70 per cent for a married man 78 per cent for a married man with two children and almost 90 per cent for a married man with four children.

It will be seen, therefore, that in the case of married men with families, the highest proportion of net pay will be replaced in the cases of those with the largest families and the lowest pay, and the proportion will decline as the levels of pay rise and the size of the family decrease. It could happen in the case of persons with large families whose reckonable weekly earnings are low that, when the amount of pay-related benefit is added to the flat rate benefit, the total amount payable would exceed the average weekly earnings on which the benefit was based. As the object of the scheme is to enable a person to maintain his standard of living it would seem illogical if the scheme were to provide for his income, during periods of sickness or unemployment, to be supplemented to a higher level than when he was working. This can be prevented by putting a ceiling or wage stop related to a person's pay on the total amount of benefit that could be paid to him and there is provision to do this by regulations.

I should like to explain that the lower limit of reckonable weekly earnings of £14 was chosen for pay-related benefit purposes because the present level of £5.55 weekly for flat rate disability and unemployment benefits for a single person represents approximately 40 per cent of £14 and a still higher percentage of normal take home pay in such a case. A single person earning less than £13.88 receives by way of flat rate disability or unemployment benefit more than 40 per cent of his earnings or more than 50 per cent of his net or take home pay. A married man in this category receives as flat rate benefit for himself and his wife at least 75 per cent of his net pay. If he has children he receives a considerably higher proportion by way of replacement income. This varies from at least 95 per cent if he has a wife and two children, to well over 100 per cent if he has more than two children or has been earning significantly less than £14 weekly; and there is no wage stop in the case of flat rate benefit.

There is, therefore, nothing discriminatory as has already been suggested in some quarters about the adoption of the floor of £14 a week proposed to be adopted in this scheme. It is a simple matter of arithmetic and commonsense, because obviously if pure pay relationship were applied to the lower ranges of weekly earnings the workers concerned would suffer a greater reduction in income when sick or unemployed than they now do under the flat rate benefit system.

The ceiling, or upper limit of pay, which will be taken into account for benefit and contribution purposes has not been provided for specifically in the Bill and it is proposed that it be prescribed by regulations. The level of this ceiling cannot yet be decided as the remuneration limit for the compulsory insurance of non-manual workers, which at present stands at £1,600 a year, affects this question. As I have already announced on more than one occasion, I am anxious to have this remuneration limit abolished and I hope to be in a position to introduce legislation for that purpose shortly.

If this limit were to stand the ceiling or upper limit on reckonable weekly earnings for pay-related benefit purposes could not exceed the weekly equivalent of £1,600 a year, since if non-manual workers over that limit are excluded from compulsory insurance there would be no case for including the earnings of manual workers above that level for pay-related benefit purposes. When the limit is abolished I will be able to prescribe a ceiling on reckonable weekly earnings for pay-related benefit purposes which will be related to the general level of wages at the time the scheme commences and which can be changed from time to time in line with changes in that level.

The average weekly earnings which will be used for the purpose of calculating the amount of pay-related benefit payable to a person will be based on his actual gross earnings from his employment which are reckonable for income tax purposes. These earnings will include all amounts paid as salary, wages, fees, arrears of pay, bonuses, Christmas boxes, overtime, commission, pay during sickness, holiday pay, "danger" money, "dirty" money, "tea" money, "tool" money, which are taken into account by the Revenue Commissioners as earnings for income tax purposes. The Revenue Commissioners will furnish to my Department all the necessary information, which will already have been recorded regarding earnings, so as to enable pay-related benefit to be calculated and paid. The information to be furnished in this regard will, of course, be restricted to the minimum necessary to enable the benefit to be paid, probably to the person's total gross earnings for the relevant income tax year in each case.

I have no doubt that objection to the use of earnings in a previous income tax year may be raised on the grounds that they relate to a past period and take no account of the rises in pay levels in the meantime. In fact, as it will be some months after the end of an income tax year before records of earnings become available, the gross earnings to be taken into account for benefit purposes may not be those in the most recently completed income tax year. However, to meet the difficulties there is power to prescribe by regulations the manner and the basis of calculation of reckonable weekly earnings for the purposes of pay-related benefit and it is intended that this power will be used to inflate reckonable weekly earnings so as to broadly compensate for the effects of the time lag.

Since the pay-related benefit will be paid as a supplement to flat rate benefit and will not be payable if there is no title to the flat rate benefit, it will not be necessary for a person to make a separate claim for pay-related benefit but he will be required to furnish whatever information is needed to ascertain the amount of his reckonable earnings in the relevant income tax year. In straightforward cases, and these should be the vast majority, all that the claimant will be required to supply will be his income tax registered serial number but in other cases he may be required to furnish further information by way of confirmation, or in cases of doubt or difficulty. It is the intention to integrate the payment of pay-related benefit into the existing system for the payment of flat rate benefits so that both the flat rate and pay-related benefits will be paid together in one weekly payment.

The pay-related benefit will be payable for not more than 147 days of unemployment during any period of interruption of employment, provided the claimant is in receipt of unemployment benefit. It will also be payable for a similar maximum of 147 days in respect of incapacity for work during any period of interruption of employment if the claimant is entitled to disability benefit. The payment in respect of incapacity for work may be made with occupational injury benefit if the claimant would otherwise be entitled to disability benefit or maternity allowance.

The pay-related benefit will, in the ordinary course, begin to be payable after the claimant has been incapacitated or unemployed for two weeks, which period will include the existing three waiting days for flat rate benefit. And here I must emphasise that the new benefit is not intended for shorter-term periods of incapacity or unemployment during which flat rate benefit will be payable, as normally these should not seriously affect the claimant's standard of living. It will continue to be paid, up to the maximum in either case of 147 days, for as long as the beneficiary continues to be entitled to flat rate benefit but, if the flat rate benefit should cease to be payable before the 147 days are completed, the pay-related benefit will also cease.

In the normal course a person claiming flat rate unemployment benefit will have three waiting days of unemployment before any benefit becomes pay-related benefit with unemployment benefit for 147 days after a 12 day waiting period which will include the three waiting days for the flat rate benefit which I have already mentioned will bring the beneficiary up to the same point where he has been paid 156 days flat rate unemployment benefit. Similarly payment of pay-related benefit with disability benefit will normally cease at the point where the person has been paid 156 days disability benefit.

I should now like to say a few words about the financing and scope of the scheme. It is provided that the cost of the pay-related scheme will be borne by contributions shared equally by employers and employed contributors. The contribution will be pay-related and thus the cost of the scheme will be spread equitably over all pay levels between £14 a week and the ceiling to be fixed for benefit purposes. I am satisfied that the Exchequer should not have to contribute towards a scheme which is designed to provide the greatest benefit for higher paid workers and from which lower paid workers are excluded and so the pay-related contribution levied on employers and employees will be set at a level adequate to cover the total cost of the scheme. For the same reason I do not consider that employers should be asked to pay a higher proportion of the pay-related contribution than an employee.

As I have already indicated, it has been arranged to have the pay-related contributions collected by way of the income tax machinery of the Revenue Commissioners and paid into the social insurance fund and the nature of the pay to be taken into account for pay-related contribution purposes will be the same as for benefit. Instead of using the earnings in the preceding tax year, however, the contributions will be based on and collected from a person's actual earnings in the income tax year then current. These earnings will, of course, be the earnings which will be the basis of the person's entitlement to pay-related benefit in a subsequent year.

It has not yet been possible to make a really firm estimate of the cost of the scheme because of lack of detailed information regarding pay levels of employees. My Department have, however, very recently been supplied with better information on pay levels and this is being processed in order to cost the scheme more accurately and to determine the level of contribution that will be required to meet that cost. Also being examined in this connection is the detailed manner in which the contribution will be collected through the income tax collection system. I may say here that largely for technical reasons this may involve collection through the PAYE system of pay-related contributions from pay below £14 a week but if so there will be a consequential adjustment of the flat rate contribution for the classes of insured persons concerned.

Apart from the question of the ceiling of reckonable earnings yet to be determined another problem still not fully resolved is that of financing the scheme in the initial stages. I will refer to this later. It is not, therefore, possible at this stage to determine the rate of contribution. Subject to what I have already said, the cost of the scheme has, however, been estimated to be of the order of £7 million to £8 million a year and the rate of contributions is expected to be about 3 per cent of reckonable earnings, of which 1½ per cent will be payable by the employer and 1½ per cent by the insured person.

The contribution rate as finally determined will be prescribed by regulations as will also the ceiling of pay up to which contributions will be levied.

The scheme will apply to all insured persons in respect of whom the ordinary full rates of flat rate employment contributions are payable under the existing social insurance system. The scheme will thus cover most persons who are in industrial, commercial and services type employments. These are estimated to number about 680,000 persons at present. When the remuneration limit of £1,600 a year for compulsory social insurance is removed this number will be increased by an estimated further 30,000 persons.

It is not proposed, at the moment, that persons whose insurance at present covers them for disability and unemployment benefit, but for whom special lower rates of flat rate employment contributions are payable, will come within the scope of the scheme at its commencement. The main groups thus excluded will be male agricultural workers, numbering about 38,000 and female agricultural workers and domestic employees who are estimated to number about 15,000.

The principal reason for the exclusion of these workers is that it will not be possible within the income tax collection system at present to collect pay-related contributions from them or to provide the information regarding their earnings which would enable pay-related benefit to be calculated. There is provision, however, for power to bring into the scheme by regulations classes of employees other than those in respect of whom the ordinary rates of employment contributions are payable and the coverage of the scheme could be extended to those classes by regulations as soon as it proves feasible to do so. Any decision in this matter, however, would revolve largely on how pay-related contributions could be collected from the particular class of employers being considered. There is also power in the Bill to exclude any class of employees whom it may not be desired to have within the scope of the scheme.

The scheme will be brought into operation by an order or orders which will be made by me and different dates may be fixed for the commencement of payment of the benefit and the commencement of collection of contributions. I am anxious that the scheme should be brought into operation as soon as possible but the Revenue Commissioners are unable to undertake the collection of the pay-related contributions from a date earlier than 6th April, 1974 which is the start of an income tax year.

The commissioners will also be commencing from that date the collection of pay-related health contributions from various categories of persons including those insured under the Social Welfare Acts. However, while the date of commencement of collection of pay-related social insurance contributions will be 6th April, 1974, it will, I hope, be possible to commence payment of pay-related benefit some months earlier and to this end I am consulting with the Minister for Finance with a view to determining the earliest date from which this can be done having regard to the usual budgetary considerations.

There is, therefore, provision in the Bill for advances of moneys from the Central Funds to the social insurance fund to enable this to be done. Any such advances would be on a repayment basis but the amounts of any such advances which may be required, the terms of repayment and the effect of such repayment on the level of contributions have yet to be decided.

As I said at the opening of my statement, the proposals in this Bill represent a significant advance in the development of our social insurance system. Not only are they important in regard to the increased benefits they will provide and because they constitute a major advance towards bringing our social security code into line with the social codes of the EEC and other countries, but they will pave the way for further appropriate developments in our social security code in the wider field of long term benefits and pensions.

It is my intention as soon as this new scheme has got off the ground and is operating smoothly to utilise the experience gained and the basic machinery established under it to introduce at the earliest feasible date complementary schemes of pay-related contributory old age, retirement, invalidity and widows pensions. I should sound a warning, however, that even with the best will in the world these proposed developments cannot be brought about overnight and any such changes must in the ultimate be considered in relation to general financial and economic circumstances and developments in other services.

I hope that the explanations I have given here coupled with the information contained in the explanatory memorandum circulated with the Bill will give Deputies a fuller understanding of the proposals in the Bill which are, of course, highly technical and specialised. I know that some criticism has been made of the length of the Bill as if the length of any Bill per se was a matter of supreme importance, and of the time taken to produce the proposals since they were first adumbrated in the Third Programme for Economic and Social Development.

The text of the Bill of itself is merely the tip of the iceberg and gives no idea of the amount of work which has gone into the consideration and development of the proposals in it or of the major financial and administrative problems to which solutions had to be found before the introduction of such a scheme could be contemplated in full confidence that it would be a practical and viable proposition.

A great deal of what I may call the "nitty gritty" details of the scheme will appear in regulations to be drafted under the provisions of the Bill. Development of the procedures for collection of contributions and also for the payment of the supplementary benefits has already entailed a great deal of work both in the office of the Revenue Commissioners and in my own Department. At this stage much still remains to be done but Deputies can rest assured that the regulations, the provision of necessary additional accommodation and the recruitment and training of additional staff will all have been dealt with in good time to enable the scheme to be satisfactorily launched.

It is, therefore, with great pleasure that I recommend this Bill to Dáil Éireann for its early and favourable consideration.

Mr. Creed

To take up where the Minister left off, I should like to see a speedy passage of this Bill through the House and an early implementation of its provisions. I shall comment only briefly on it now because I hope to table some amendments. I welcome the Bill on behalf of the Fine Gael Party. It is something we have been advocating for some time. I accept part of the Minister's explanation of the delay in introducing the Bill. I want to welcome it as far as it goes but I want to condemn it for what is not in it. However, it is a step in the right direction.

The purpose of the Bill is to introduce pay-related benefits as part of our social insurance scheme. This is desirable because the amount paid by the Department of Social Welfare to a person who is unemployed or ill should be related as closely as possible to his income when he was working. The 40 per cent of the income over £14, added to the flat rate of unemployment and disability benefit and maternity allowances, will be a great help to people in receipt of these benefits. As the Minister has said, it is a matter for employers and employees to make the contributions available so that it will be possible to have a pay-related income in the event of unemployment or illness. The Exchequer is not paying one halfpenny towards providing those services.

I find it very difficult to discuss social welfare on the narrow lines of the Bill because all categories of social welfare benefit are closely related. The Department of Social Welfare is closely related to other Departments: for example, to the Department of Local Government which is responsible for housing. I would condemn the Government because they have not stood back and taken a long hard look at the problems in relation to social welfare, particularly the way in which other Departments affect the Department of Social Welfare—the Departments of Health, Education, Labour. Our approach to improving social welfare benefits has been piecemeal. It will be necessary, at some stage, to examine in detail the way in which we can improve the lot of people who are depending on social welfare benefits. It is very necessary at this stage, even in the short term, that there should be improvements in the benefits paid to all social welfare recipients. Fine Gael believe in the concept of community responsibility to ensure that our people are entitled, as a matter of right and not of charity, to an adequate standard of living and that this standard should not be depressed as a result of ill-health, unemployment or other misfortune that can happen a family in the normal course of events.

For too long priority has not been given to reforms in our social welfare system. The neglect is illustrated clearly by the fact that in recent years social welfare benefits have been increased each year at budget time and at other times during the year but, as I said in my speech on the Estimate, the benefits paid have been outstripped by the rapid increase in the cost of living. This is the problem which we have not tackled. The Government must not alone concern themselves with the increase in wealth and economic expansion, they must ensure that there is an equitable distribution of the wealth created and that the wealth will be redistributed for the benefit of the poorer sections. There is, as everybody realises, and the position is getting gradually worse, an ever-widening gap in this country between the rich and the poor. The rich are getting richer every day and the poor are getting poorer. The present Government have for far too long concerned themselves with political problems and have paid no attention to the end result of the creation of greater wealth and of economic expansion.

I claim that social and economic expansion should go hand in hand. I know it is very difficult in a country such as ours with the high ratio of dependants to workers due to emigration, the large size of Irish families and the high rate of unemployment that exists at present. This has the effect of requiring the application of more resources, of making a greater charge on the Exchequer to provide the benefits which are so badly needed. Because we have a problem of high unemployment and emigration, far more resources must be devoted to social purposes to provide any level of social benefit per recipient. Another factor which has added to this problem is the abnormally high number of people in institutions. I agree with Deputy Desmond that the Department of Health and the Department of Social Welfare should go hand in hand and should be under one Minister. Here we have an abnormally high number of old people in institutions who would be far happier in their own homes but we have never examined this in depth. What we should be aiming at is to reduce, as far as possible, the number of recipients and increase the amounts payable to them. There are in institutions people in receipt of social welfare benefits. The rate is not adequate to keep them in their own homes. Hence there is the cost to another Department of providing accommodation for those people. The fact must be faced that our present social-welfare system is based on how little we can give them rather than on how much. This system is not alone antiquated and inefficient but unjust. It leaves far too much to voluntary organisations who are doing a considerable amount of work to help those people who have not an adequate income.

I welcome wholeheartedly the statement made in relation to social welfare by the Council of Bishops set up to examine this problem. It is about time they did it, and I want to quote and extract from the report on it in the Irish Independent of Monday, 20th of this month. It says:

According to a dietitian, the minimum cost of providing an adequate diet for a family with four children priced in three Dublin supermarkets worked out at £10.41½ per week.

Since we are not doing anything about this situation, we are condoning families being committed to this low income. This is a problem that must be tackled but not in a piecemeal way. We in the Fine Gael Party welcome the Bill as introduced here. However, the benefits should be extended to other social welfare recipients. I have in mind widows with families, who are finding it very difficult to exist on the income they have. If a breadwinner dies, his widow and young family are compelled to live on approximately half the income they had prior to the tragic loss of the breadwinner. The widow's income should be related to that which her husband had.

I welcome the fact that there is a phased contribution. I am not too concerned about it from the employer's point of view but in the case of lowly paid workers with a number of deductions from their pay packed, a pay-related contribution will help in no small way.

I am also pleased to see in the Minister's speech—I was not able to follow it as fast as he was reading it— that he has in mind the removal of the £1,600 limit. This is something the Minister should do as soon as possible. I should like to see the social insurance scheme extended to self-employed people, extended to a far wider range of people than it is benefiting at present, and particularly to farmers. There is a problem in regard to the farming community in that they are very slow to hand over their right to a farm to the son. It is a great social problem, and the reason for it is insecurity. If they are included in the social insurance scheme it will provide security for them when they reach the age of 65 and they will be more inclined to hand over the farm to the son so that the son can get married and carry on the business as before.

In the explanatory memorandum which the Minister has circulated I find under one section that there will be a waiting period of two weeks, including the existing three waiting days, in the case of both incapacity and unemployment, before pay-related benefit becomes payable. Do I take it that when somebody becomes unemployed or ill there will be a delay of two weeks and three days before benefit is payable? The greatest complaint I find people who have made application for benefit have is the long delay before the decision is reached, particularly in regard to unemployment benefit.

Where an application is made and where it is determined after some time that the applicant is entitled to benefit or in cases where the application has failed, generally he is not notified that he would be entitled to unemployment assistance. There are complaints every day of the delay in reaching decisions. I notice from the Minister's speech that this is something with which he is dealing throught the Revenue Commissioners. I can envisage some delays here as well and that it would not be feasible at this stage to set up a special computerised system for determining who is entitled to benefit. However, the Minister should consider in the future the provisions of some means of eliminating the delays. Unlike other people who are better off, those in receipt of social welfare benefit find it difficult to get credit from the grocer or anyone else. If the Minister could do something in that respect he would be doing a great service to those in receipt of benefit from his Department.

Again I welcome what is in the Bill, and I intend to put down some amendments to it on Committee Stage.

Mr. Desmond

I also welcome this constructive piece of insurance legislation which reflects the proposals of the labour movement in the Republic and on the island as a whole. It reflects our persistent demand for the introduction of a comprehensive pay-related system of social insurance. I think it is instructive enough for this House to look back very briefly and remind itself that as long ago as October, 1949, the then inter-party Government published a White Paper on social security and then proposed that social insurance should be extended to cover every person over 16 years working for an employer. Twenty-two years later this policy is being implemented slowly. This is instructive in the context of social change. It shows the slowness with which our society reacts to the entirely legitimate demands of more enlightened politicians. The late Mr. Willie Norton, when he was Minister for Social Welfare in 1949, was farseeing in his suggestions.

I welcome the Bill, with a number of substantial reservations. I wish to point out emphatically that it looks as though we will get from the Minister a commencement date for the Bill. It looks as though the commencement date will be not earlier than January or February, 1974. The Minister will not dispute that. It will be earlier than the commencement of the tax year of 1974. Lest the euphoria of the Fianna Fáil Party should carry them away at the time of the next Árd-Fheis, the insured workers of this country should be told now that the Bill will not be in operation officially until April, 1974, at the commencement of that tax year.

Mr. J. Brennan

I said that was the date of collection of contributions, but that the benefits would be come in before that.

Mr. Desmond

Some months earlier. Being aware of how the Department of Finance reacts, I am sure the Minister had to choose his words carefully when he stated that he hoped it would be possible to commence payment of benefits some months earlier. I would estimate that they would be paid in January or February, 1974. That would look all right in a May or October election. It would solve the problem reasonably well.

We have been waiting for this Bill for about three years. The first hint of it came from the official Government attitude about three years ago. The Bill has now come. I did not hold out much hope that it would be in operation in April, 1973. I would not expect that the Revenue Commissioners would have been able to resolve the very difficult problems in connection with the introduction of the collection. I suggested in a statement which I made on 10th November that we might have to wait until April, 1974, for the commencement of the operation of the Bill. It is important to point out that there will be a considerable time-lag before the benefits are paid.

In fairness to the Minister and to his Department, because of the very cool reception which this Bill got, because of the confusion surrounding the publication of the explanatory memorandum and the Bill itself and, more particularly, the Minister's briefing of the newspapers, a great many questions were unanswered. I am glad to note that the Minister has stirred himself in no uncertain manner and his Department have produced a comprehensive brief for the Deputies explaining the intricacies of the Bill. This Bill, particularly on the actuarial side, is difficult to follow.

I would have thought that the Minister might have told us the estimated numbers of beneficiaries in terms of trends over the past two or three years. About 55,000 persons get disability benefit. Also, about 3,000 persons get occupational injuries benefit. These people will benefit under the new Bill. A figure should be readily available of the estimated number of persons who will be in receipt of unemployment benefit in 1974. This figure may be 30,000 or 35,000 persons. It would be interesting to know on what actuarial data the Department were working when estimating the cost of the benefits. In 1974 there may be 55,000 or 60,000 people receiving disability benefit. At that stage there could be 3,500 people in receipt of occupational injuries benefit, and 35,000 or 40,000 in receipt of unemployment benefit.

These are the totals on which the estimates are being made. I would be interested to hear precise statements from the Minister about these matters. It is difficult to estimate the number of people who will be in receipt of maternity benefit in two or three years' time. The Minister could, perhaps, tell us the total number of maternity benefit recipients at present. These people will benefit from this Bill. The Minister did not give the totals in his Second Reading contribution.

I would ask the Minister to elaborate on the thinking behind the two weeks' waiting period. This would come as a rather gratuitous statement from the framers of the Bill to the many insured workers. I appreciate the thinking behind the three days' waiting period but we are now to have in addition to that three days' waiting period for flat rate benefits the two weeks' period of stoppage. The Minister stated:

Where, however, the incapacity for work or unemployment lasts for longer than a fortnight, the flat rate benefit will be supplemented by pay-related benefit ...

The Minister stated subsequently that the real value of the pay-related benefit is to maintain the beneficiaries' standard of living. I submit that very frequently one finds workers on short time in certain industries who may be out of work for two weeks. They may be transferring from one employment to another over a period of two weeks. As we know, in a modern, sophisticated, expensive, industrial economy, if an insured worker is on flat rate employment benefit, or if he is sick for two weeks and is on flat rate disability benefit for these two weeks, this can have a fairly catastrophic effect on his standard of living in the sense that the standard of living of most people is affected week by week. This is my experience even on £2,500 a year as a public representative.

Most workers are unable to meet their normal rent, food and credit commitments in those two weeks even on flat rate benefit. Therefore, I am wondering what is the thinking in the Department behind the two weeks, what one might call, penalty clause in the introduction of pay-related benefits. I did not bring with me the British handbook or the Northern Ireland handbook. I would ask the Minister to compare the situation here with that in Northern Ireland. Only recently I received the new British Social Security Bill. Frankly I have not had time to go through it. Notwithstanding the fact that this Bill is very closely modelled on the British approach, there should be some further public explanation of the two weeks' waiting period for payment of disability, unemployment and maternity supplementary pay-related benefits.

Mr. J. Brennan

The British waiting period is approximately the same. They call it 12 days, referring to working days.

Mr. Desmond

I have never been entirely convinced about the three-day waiting period, although I accept that there has to be some time lag. Many industrial workers may take umbrage at the idea of having to wait for 12 days before getting their pay-related benefits. I hope the Minister will comment on this matter by way of justification.

I should also like the Minister to elaborate further on the thinking behind the lower limit of reckonable weekly earnings. I understand that £14 a week has been chosen as the lower limit and that up to £14 a week flat rate benefit will be paid. While a good deal of internal research has been done in the Department of Social Welfare—I have no doubt about that; in fact, the Department are better than people think—on the fixing of the lower limit of £14 a week, nevertheless I want to repeat the assertion I made when the Bill was first published, that this sounds to me rather discriminatory particularly against women workers. I would ask the Minister to deal with that matter also.

There are still a large number of women workers in the State at the £14 a week earning point. They pay relatively higher insurance contributions than men and it appears that they will suffer under this Bill. I should like to know why the figure is £14 a week. I am not convinced that the low point has been struck sufficiently low. In Northern Ireland and Britain, under pay-related benefits, the supplement is one-third of average weekly earnings between a£9 and £30, providing total benefit does not exceed £85 of average weekly earnings. This is only by way of oblique reference to another lower limit of £9.

I suggest that there is a section of insured workers earnings up to £14 a week who will not benefit in any way from this Bill. This is a large section of workers, mostly very young people in industry and women workers. They have very low earnings. They work in what might be called the more exploitable industries, such as the personal service industries. Workers earning up to £14 a week will not benefit under this Bill. Those who will benefit are workers with £14 a week plus, up to an as yet unknown ceiling. Therefore, the Minister must exercise extreme care in the selection of the lower limit of £14. While I appreciate some of the reasons given, I do not think they are entirely convincing when one considers individual categories of workers on the lower ranges of weekly earnings. We could benefit from the Minister's observations in that regard.

The Minister should be more explicit about his definition of the relevant income tax year. Since the Bill will not come into effective operation until early 1974, we should at least try in the Dáil to indicate the precise tax year. Nowhere in the Bill itself is there an indication that the previous tax year is the actual year in mind. Therefore, there is a lack of precision in the Bill. While we appreciate that gross earnings will be taken into account for benefit purposes, and that the Minister may in some circumstances be obliged to calculate them not necessarily on the most recently completed tax year—this may happen at the end of a tax year—nevertheless a major criticism of this Bill is the multitude of areas in which definitions are not given, for example, a definition of reckonable weekly earnings or of the relevant income tax year. I do not think it is good enough, particularly in respect of legislation which will not come into effect until the beginning of 1974, that we should be left in the dark on those issues. This is a typical approach. I do not blame the public servants but I do blame the politicians who cannot make up their minds.

The Minister's speech on Second Reading conveyed vastly more information in relation to the definition of reckonable earnings than what is in the Bill and that is a rather odd situation in which to find oneself when discussing a piece of legislation. At no stage in the Bill is it set out as the Minister says at paragraph 9 of the explanatory memorandum, that the amount of pay-related benefits payable to a person will be based on this actual gross earnings from his employment which are reckonable for income tax purposes. We well know that the Revenue Commissioners are quite capable of absolute expertise in the definition of gross earnings but these forms of definitions should have been written into the Bill. I well remember the Minister being interviewed by Pat Sweeney the day the Bill was published. He was putting questions to the Minister as to persons out of works, persons involved in an industrial dispute whose earnings dropped and what was meant by earnings over a specified period and the Minister replied that perhaps it may be and may not be. I do not blame the Minister because it was not in the drafting of the Bill but it should have been. We should have that kind of information because that is what the industrial worker wants to know. That is the basis of his analysis of the Bill and a definition of reckonable earnings should therefore be included. I ask the Minister to have a careful look at that in this further consideration of the Bill.

I suggest to the Minister that he should specifically include male agricultural workers within the scope of the Bill. There are 38,000 of them specifically excluded and I think it is disgraceful that they are excluded, that agricultural workers, a group of lower income employees in the primary industry of the State who are insured should be excluded. I would point out also, that another 15,000 workers, female agricultural workers and domestic employees, are excluded. This is a situation in which 53,000 insured workers, those perhaps most in need of pay-related benefits, particularly disability benefit and, indeed, unemployment benefit, with the lowest incomes, are excluded. I do not accept for a moment that it is impossible in this computerised age to devise a parallel supplementary system of collection of the contributions from the earnings of such workers.

The principal reason given by the Minister for the exclusion of these workers is that it is not possible, within the current income tax collection system, to collect contributions from them. I accept that there are difficulties but in equity and in justice, these workers should be brought within the scope of the Bill. Why not bring them in now and if in January or February of 1974, when the precise collection system will have become more publicly obvious, the whole thing became impossible the Minister could then exercise his power of regulation, if he so wishes and possibly exclude them. I am not suggesting he should but it is better to include people first rather than exclude them first, hoping in the distant future in the days of the computer data banks, to bring them within the scope of the Bill. In practice as we well know, such groups find themselves never brought within the scope of the Bill so that they will be out in the cold once again. In fairness, the collective intelligence of the Revenue Commissioners and the Department of Social Welfare should be exercised on that problem with a view to devising a system of bringing them within the scope of the Bill.

I make a further and different point in relation to the cost of the scheme. The insured workers and the employers should be under no illusions about the cost of what is being proposed. It will cost £7 million to £8 million. I suppose that at the current rate of inflation—and it is ironic that when Willi Brandt can find himself in the middle of a general election campaign with a 6 per cent rate of inflation, we are happy if it is below 8 per cent or as it is now running, 8 or 9 per cent—by the time it is in full operation in the middle of 1974 that figure may well be £10 million, or of that order. The substantial cost of the scheme should be borne in mind and the basis of the contribution proposed by the Government should be very much borne in mind by industrial workers and employers.

I suggest that we have had an unfortunate contribution from the Minister in terms of the cost. The Minister has relied on what one would call the conventional wisdom of the Department, that the employer will pay 50 per cent and the insured person 50 per cent and, in this instance, the State proposes to pay nothing. I suppose that since general taxation falls heaviest on those who pay income tax and PAYE and on insured workers, and the contribution of the State would have to be recouped from the insured workers, the reluctance of the State to contribute further is perhaps understandable since we would be passing it on for the most part to industrial workers.

I suggest to the Minister that it is contrary to the established trend in the EEC and in the UK to expect merely a 1½ per cent contribution from both the employer and the insured person. In a scheme of this kind in the Common Market one finds the contribution ratio to be in the region of 2 per cent from an employer and 1 per cent from an insured worker. The Minister should indicate to the House what the order of contribution would be. However, we can come to that later. I would point out to the Minister that there is no indication whatever in the Bill of the basis for contributions from employers and employees. There is no indication in the Bill that the contributions towards the social insurance fund and the rates of payments from reckonable earnings will be on the basis of 1½ per cent from both the employers and the employee. There is no indication that the contributions shall be on an equal basis. That is another deficiency in the Bill as proposed.

I am becoming increasingly disturbed in the House at the extent to which we receive legislation with the regulation concept, that is that the Minister may, by order, prepare regulations and so on. This is political laziness. It is nothing more than administrative convenience, and in the long run it will result in the Order Paper being composed of more orders and regulations than proposed legislation. The Minister should point out to workers the precise amount that will be expected from them, and he should also let employers know what their contribution will be.

I approve of the principle of collection of income tax under the PAYE system. I accept that there is no other way of doing it. I would ask the Minister whether there is any kind of social insurance policy programme within the Department at this stage. Midway through the Second Reading of this Bill we are informed that we may expect legislation very shortly for the abolition of the £1,600 limit. I am wondering where is the hen and where is the egg so far as the Department are concerned. I am afraid that at this stage the hen is suffering from political paralysis, because I would have thought that the priority in social insurance would be the general extension of social insurance above the £1,600 limit and to carry that extension to retirement pensions, to old age contributory pensions, to mortality benefits, contributory widows' pensions, invalidity pensions and so on rather than to produce this kind of Bill which is confined to unemployment, disability and maternity benefit with a ceiling as yet unknown.

Mr. Moore

The reasons for this have been given by the Minister.

Mr. Desmond

They are not very convincing. It is my belief that there has been a good deal of pressure on the Minister in recent months to produce some social welfare Bill and that this is the result. An amazing feature of the Bill is that the upper ceiling limit is not known. I appreciate that the Department have only now received further information in respect of pay levels in Ireland generally, but the non-insured worker in the state who is outside the £1,600 limit will be anxious to know why he is not covered by this Bill. I do not wish to see a situation whereby at the end of 1973 the Minister will then produce the upper ceiling limit. People are entitled to know now what is the ceiling. If it transpires that in the middle of 1973 we need a new limit one could be brought in then, but let us fix something now on a definite basis because the present Bill in that regard is unsatisfactory.

Without in any way sounding mealymouthed, I welcome the Bill as a serious step forward in the history of social insurance in this country. Leaving aside the work done in the Department, for which I have the greatest regard, nevertheless, after a great deal of political gestation in the Department the Bill is still vague and rather inadequate in many aspects. Of course, the Department can react only to political pressure and demands.

We intend tabling several major amendments on Committee Stage. We hope that these amendments will be accepted by the Minister because, together with amendments that may be tabled by Fine Gael, they will strengthen substantially the introduction of a universal system of social insurance in this country. There is nothing in the Bill for anybody who is earning less than £14 per week. The Bill contains nothing for a self-employed person or for the small farmer. It is my hope that in time we shall have the principle of comprehensive insurance here. I see major difficulties in respect of farmers and self-employed persons, particularly in regard to the collection of contributions, but these difficulties must be faced in the 1970s.

I hope the Minister will accept the amendments in the spirit in which they will be offered. When the Redundancy Payments Bill was going through we managed to wring several important amendments from the Minister— although I recall Deputy Haughey subsequently claiming credit for those amendments, but I do not recall him tabling them.

Mr. Moore

He was claiming credit for them on behalf of the party as a whole.

Mr. Desmond

The amendments we shall put forward shall be as constructive as possible and we shall cooperate with the Minister in giving the Bill a speedy passage through the House—before Christmas, we would hope.

Mr. Moore

I join with those other speakers who have congratulated the Minister on the Bill. It signifies a new dimension in social welfare policy in this country. Deputy Desmond implied a greater tribute to the Minister than I could pay him when he suggested that he had filched Labour Party policy. I do not accept the truth of that assertion but it is a recognition of the good qualities of the Bill. The Bill represents progress in the sphere of social welfare. On Second Stage Deputies may suggest means of improving the Bill and when we do so the Minister will recognise that we are trying to be helpful.

There is the case of the benefits payable to a man who has a wife and children, one or more of whom may be handicapped. At present there is no special provision in our social welfare legislation for a handicapped child. Our social welfare code should recognise that special benefits should be given towards the upkeep and education of handicapped children of a family. That would be in accordance with our philosophy. The Fianna Fáil Party since its foundation has tried to develop a comprehensive social welfare system. It is a matter of pride that we were the first in these islands to introduce the children's allowance. It would be a step forward if provision could be made in this Bill to help a man benefiting under the Bill who has one or more handicapped children. It is a principle of social welfare that the neediest must get the greatest benefit.

I realise that tremendous work has gone into the preparation of the Bill. It could be described as an actuarial exercise. The availability of computers and a highly efficient civil service makes the task of assembling necessary information less difficult. It should be possible to spotlight areas of greatest need so that they can receive the greatest benefit.

I regret that voluntary contributors to the social welfare fund are not covered by the Bill. I realise the difficulty involved in their inclusion at this stage. The Minister has said:

As I have already announced on more than one occasion, I am anxious to have this remuneration limit—that is, the £1,600 a year— abolished and I hope to be in a position to introduce legislation for that purpose shortly.

Many voluntary contributors earn more than £1,600 a year. They pay fairly heavy contributions to the fund, for which they do not get a great return. Most of them are voluntary contributors in order to provide a State pension for their widows. I take heart from the reference the Minister made to his desire that the £1,600 a year limit should be removed. I hope to see the day when there will be no limit for social insurances purposes. In the meantime the resources of the State must be directed to the areas of greatest need.

It is regrettable that girls in domestic employment are not covered by the Bill. There is great demand for girls for domestic work. The status of domestic work has changed. Girls in domestic employment will be disappointed at not being included in this legislation. They pay social welfare contributions. Their case should be considered. There are other categories also that should be included.

The Minister has made a magnificent effort in this legislation. A few adjustments would improve the Bill. It might be difficult to cover the self-employed in this Bill but certainly domestic servants should be included. I realise that if it had been a simple matter to include domestic servants, the Minister would have included them. However, it is no harm to record our concern for them and for other classes who are not included.

I understand that there is a certain number of unclaimed benefits. Might I suggest that the money that is unclaimed could be used for the purpose of paying extra benefit in the case of the handicapped members of a family to whom I have referred?

There have been calls from churchmen during the week for a minimum wage. The difficulty about providing a minimum wage is that unscrupulous employers might make the minimum the maximum. Such a development would not be welcomed by trade unions or anybody else. There are certain basic standards which must be maintained. The Government, in successive budgets, have raised the standard of social welfare for the aged, the blind and widows and orphans. This Bill represents further progress. The Bill may be criticised for alleged shortcomings but the economy must be developed so as to provide increased State funds for social welfare purposes.

One can recall that greater benefits were not paid ten years ago, not because any Government did not want to pay them but simply because the money was not available. It is a very good sign of the progress made since that the Minister can now bring in a pay-related benefit Bill. There are still worrying cases on the social welfare scene and one can still point out the delay in payment in that Department but these are isolated instances. The cover given by the Government in the social welfare code is increasing all the time. I am confident that we shall have legislation, as the Minister said, later which will be a further step forward. We cannot be complacent and we must maintain our sense of proportion in regard to the financing of such schemes by the State. It would be easy to increase the contributions payable by the insured and the employer but it would not be, perhaps, the most equitable way to do it. The lower paid worker, for instance, pays the same amount for his social welfare stamp as the man who is just under the £1,600 mark. Many years ago I suggested in the House that in order to give the lower paid worker an extra benefit we might try to reach the stage where he would not pay any contribution to the social welfare fund. Each year there is a plea to help lower paid workers but it is not easy to do so because higher paid workers fight to maintain the differential. If the State were to waive the social welfare charge in the case of the lower paid worker he would save £1 a week or more and the higher paid workers could scarcely suggest the differential was being affected.

I congratulate the Minister again on this Bill and on the promise it contains of further improvements.

Minister for Social Welfare (Mr. J. Brennan)

I am very pleased with the generally good reception this Bill has received. None of the criticisms levelled against it relates to the general principle which has been accepted on all sides of the House. That is encouraging.

There was criticism of the delay in introducing the Bill and criticism that the coverage did not extend this time to agricultural workers and domestics. The two weeks' waiting period was criticised and the £14 floor limit and it was suggested that the scheme should be brought in earlier that April, 1974. It was also asked why the ceiling was not being given at this stage and whether the estimation would be based on real earnings and if the figure would take account of sickness, strikes and other factors which result in persons losing part of their earnings in the previous year.

To deal with these points in a general way I shall take the last one first. As is done in the United Kingdom generally, pay must be based on the real earnings, what the person actually earned and paid tax and contributions in respect of in the previous year. It will not be notional earnings, what the person would have earned if he had been working all the year. Periods of sickness or unemployment will not be considered as periods of earnings. It will be actual, real earnings on which income tax and contributions have been paid that will count for pay-related benefits. This is the system used in other countries where this type of scheme operates.

Agricultural workers are not included at this stage because I could not get the Revenue Commissioners to agree to go that far. I was glad to be able to get a collection system going for the limited scheme I am now producing in the knowledge that we shall gain experience. This is most important: this is a complete breakthrough to a new system of collection and payments and experience will help us to get the scheme off the ground. I was glad to achieve this after a long delay occassioned by the tremendous amount of research, assessing and examination involved. The important point about the Bill is that it is breaking important new ground. After we have gained experience in the transition period, the inclusion of other categories will not pose any great obstacle particularly in view of my desire to have our own computer system installed as soon as possible. A number of considerations arise there: space is one of them and suitably trained personnel is another.

Mr. Creed

If the Minister had the computer installed would he include agricultural workers?

Mr. J. Brennan

It would be possible then; by that time I hope we would be well ready for a more comprehensive application of the scheme.

The £14 floor was brought in because pay-related benefits are reckoned at 40 per cent of the earnings and the flat rate benefits at present are approximately 40 per cent. We are sticking to that as a reasonable level but the Bill provides that this level may be adjusted at any time. I do not think anybody is unduly worried that the ceiling is not stated. This ceiling is fixed for us at the moment at £1,600 but if we remove that limit, as I propose, then we shall have to fix a new limit. It would be rather speculative to mention a limit at this time. All the other basic essentials are given in the Bill as to the percentage to be collected in contributions and the percentage to be paid so that the upper limit is not of particular importance of relevance at this stage.

It was understandable that a waiting period of two weeks should be fixed. It would hardly be worthwhile having a shorter period. The period of two weeks was considered a reasonably short period during which time the recipient would get the flat rate benefits, as he did previously, and would not be unduly inconvenienced as a result of being laid off for that time.

One of the criticisms made was that we have been talking about this Bill for a long time. This is so. It is easy for people on the Opposition benches to make suggestions and proposals but when I talk about something I must produce legislation or adopt measures to carry out what I propose. However, irrespective of what some people may say, we must have regard to our resources.

One cannot fail to notice various organisations of lay and church men who make laudable proposals with regard to what should be done. One cannot blame these people for making the suggestions but I should like to point out that it is the Government who have to provide the resources that will be required. One day some section suggests that we should concentrate entirely on solving our housing problems to the exclusion of all other matters; another day another group suggests that we should devote all our resources to education. We have to deal with all these matters and the question of priority must be taken into account. One service cannot get exclusive attention; if housing, education, the provision of public amenities and health could be pushed into the background and all the money given to me I could produce the most grandiose social welfare scheme. However, all the other items must get their share of the national resources.

Deputy Desmond had published a nicely-written article in a Sunday paper recently but I should like to point out that he resorted to one of the oldest tricks, namely, he used the figures that would look best from the point of view of the Opposition. He gave the percentage of expenditure on social welfare during a period of seven or eight years as a percentage of total budgetary expenditure. He quoted this figure at approximately 17 per cent but he did not give the base from which it was derived. Naturally 17 per cent of £30 million is much less than 17 per cent of £60 million. In no case did the Deputy give the base and, while I do not question his right to present his case in this manner, I should like to point out that it is one of the oldest tricks in the trade.

The GNP is regarded always as a fair means of assessment of the amount that is spent. I am referring to this in the context of the suggestions that have been made regarding the type of social welfare scheme we should have now. It is easy to outline the course which it is hoped would be followed with regard to social welfare but in the implementation of a comprehensive scheme regard must be had to the availability of resources and to the other items that must also receive attention.

In considering the figures for the year 1959-60 to the present time in connection with the expenditure on social welfare as a percentage of GNP one finds interesting data. In 1959-60, the GNP was £638 million and the percentage for social welfare was 5.1. In the current year, GNP is an estimated £2,138 million and the percentage for social welfare has risen to 7.2. This illustrates the rapid progress that has been made in the scope and rate of social welfare. The figures I have given are incontrovertible and I would recommend them to people who make suggestions regarding our social welfare scheme. These people should study the figures I have given regarding the redistribution of the national wealth.

People who make comparisons between our country and other States with regard to the redistribution of national wealth should keep in mind what these other countries consider as social welfare services. We take figures relating to actual social welfare payments; we do not include education, other pensions that are paid in the public service, we do not include the cost of housing or sanitary services. We do not include many of the items that could be regarded as coming under the heading of social welfare. We include only the payments on the income support side and payments for retirement and for other contingencies affecting persons in employment and the welfare classes.

By any comparison our record is excellent and will stand up to any test. I should like that some tribute be paid to the progress we have made in the short period since the introduction of social welfare benefits into our annual budgetary considerations. We have long since passed the stage when we regarded the rate of development in social welfare as being tied completely to the rate of economic expansion.

The recent conference in The Hague which I attended had to do with social planning as part of the general programme which any country would adopt irrespective of the likely economic expansion or increase in national income over a period, with the realisation, of course, that the resources had to be there. It is also recognised that good social planning is a contributory factor to economic development.

We recognise that but we cannot lose sight of the fact that we must provide the means and that we cannot go too far in the direction of imposing taxation in order to redistribute the national wealth at any given time. Deputy Desmond asked the plans the Minister for Social Welfare has in regard to social welfare development. I have given those plans on other occasions and I have said that I have deliberately refused to produce a White Paper because when it is produced people are likely to expect it to be implemented straightaway. Of course, the rate at which progress can be made in these matters cannot be accurately predicted from time to time. The only thing we can say is that here the rate at which we are picking up is becoming greater each year.

The Bill now before us opens a new road to further development which I regard as being all-important. It is the beginning of a comprehensive system of social insurance which I hope we will be able to apply to the entire community in the shortest possible time. When we have reached that stage we will be able to get away from our old problem of means tests in the matter of qualification for assistance benefits. Such means tests have had to be applied to non-contributory benefits paid to persons who do not contribute to such benefits.

I have been asked by Deputy Desmond for certain figures. I was asked for the numbers likely to benefit at any time. The number in respect of disability benefits is 14,000, unemployment is 21,000, maternity allowance, 1,450 and occupational injuries, 450. As I mentioned in my introductory remarks, occupational injury beneficiaries as such would not qualify for pay-related benefits. We must remember that the two weeks' waiting period comes into effect here. Persons who have less than £14 a week would not be in the pay-related system.

I cannot resist having a crack at Deputy Desmond and his reference to the 1949 White Paper brought in by a coalition Government. That did not include pay-related benefits. As a matter of fact, it regarded flat rate benefits as sacrosanct. When this Government came back to power in 1954, it was not bothered with any more. However, we will forget about the bad old days and think about the future.

Mr. Desmond

What about the 1952 Social Welfare Act?

Mr. J. Brennan

We are now making rapid progress. We are glad to see this and to see growing awareness on the part of the public generally of our desire to have a fair proportion of the national wealth redistributed towards helping the weaker sections. As long as there are people prepared to accept this as part of our social welfare pattern, who are prepared to accept it as a Christian as well as a moral obligation, we will have the necessary means to provide for those who, through no fault of their own, are unable to provide themselves with an adequate living.

The rates which we pay at any given time will always be a matter for criticism. If I were on the other side I would be inclined to say that an increase at a certain time was not enough. Of course, we will never reach the stage when somebody will say: "You are giving too much—we would not give as much if we were in power." The easiest thing to do from the point of administration is to increase existing rates. Of course, it is not easy from the financial point of view but, administratively it does not cause any great difficulties. I do not know whether the House appreciates how difficult it was to prepare and to bring this Bill before the House. If I were to wait until everything was rolled into this legislation we would be waiting a long time. It is as simple as that. I am particularly glad to have this Bill at this time because it marks the beginning of a new era in social welfare based on a more equitable system which will be in keeping with many of the schemes with which ours has been compared.

As I have said, there will always be people too ready to challenge our figures and to compare them adversely with those elsewhere, with those in Britain and the Six Counties. I would point out that here we do not collect contributions from everyone between the age of 16 and the time he retires. If we proceeded to do that, our social welfare structure would be considerably stronger because the fund from which we disbursed benefits would be considerably larger. I have been asked what it would cost to bring our services up to the level of the British. In the matter of the existing schemes it would not take much. However, many people misinterpreted my reply. Pay-related schemes and supplementary schemes in Britain were produced. I would say to those who try to denigrate the system we have that they should look at the rapid progress we have been making in the past ten years, to look at the amount we distribute as a percentage of gross national product. We must always have regard to the number of persons receiving benefits at any particular time.

I am not making excuses for the Department. I do not like undue delays in any scheme but I was glad that some speakers today recognised that the Department have a difficult job in that they are dealing with huge numbers and the percentage of our Vote which goes to administration compares favourably with any other Department of State.

The Bill was referred to as being in line with British legislation. That is true. It is not merely in line with British legislation in this respect; it is pretty well in line with the legislation of other countries which have pay-related benefits. I do not see anything wrong with having a look at what other people are doing, copying what is good and discarding what is not. We have that benefit. We have not always done that in social welfare. We had schemes here which they have not yet got in any other country. As Deputy Moore said, I think, we were the first to produce a non-contributory widows' pension scheme and our children's allowance scheme was among the first, if not the first, produced anywhere. We did not have to wait to copy from anybody with regard to many of our schemes. That is not to say that I would not be prepared, at all times, to have a look at other countries' schemes, to see what is good in them, what would be applicable to our conditions here and what would be useful and suitable to our circumstances.

The main objective of any Minister for Social Welfare is to do, as rapidly as he can, what is necessary to give a reasonable standard of living to those who lag behind through no fault of their own—due to illness, unemployment, old age, disability, widowhood, invalidity and so forth and to do the best he can at all times, having regard to the resources available to him, for these needy sections. It is not coming out of the Minister's pocket; it is not coming out of the pocket of the Government; it is a matter of how much we decide to take from the people, from the national purse, how much of the national income we decide to redistribute at any particular time so that we may give better payments to these people. I am delighted that we have unanimity in the House and outside it with regard to the rate at which we should progress in this respect. I can assure the House that it will not be my fault if we do not move rapidly towards a scheme of which we can be proud in the overall payment of social welfare in the future.

Question put and agreed to.

Committee Stage ordered for Tuesday, 5th December, 1972.