asked the Minister for Social Welfare if she will consider introducing a limited credit facility under the supplementary welfare scheme where people could get access to small loans to meet contingencies, in view of the very high level of recourse to unscrupulous moneylenders for these purposes at present.
Ceisteanna—Questions. Oral Answers. - Limited Credit Facility.
2.
The scheme of supplementary welfare allowances is a flexible one and community welfare officers have a large degree of discretion which enables them to give assistance in cases of genuine hardship or exceptional need. Assistance under the scheme can be given to persons involved with moneylenders but it would be of advantage to persons in this situation to seek advice from their community welfare officers in the first instance before having recourse to moneylenders.
While the supplementary welfare allowance scheme is mainly a basic income maintenance scheme, it does, however, provide for once-off payments to meet special needs. This, undoubtedly, is the area which gives rise to resort to moneylenders by some people and I would have grave doubts about revising the supplementary welfare allowance scheme to enable money lending facilities to be provided in addition.
A more fundamental review would be necessary to see what might be the best approach in this matter and this will be done in the context of the overall review of the social welfare system which is being undertaken following the submission recently of the report of the Commission on Social Welfare.
Is it not the case at present that when people who might be caught by high rates demanded by unscrupulous moneylenders look for assistance under the supplementary welfare system, in effect, money from the taxpayers will end up indirectly in the hands of such moneylenders demanding usurious rates? Is it not the case that there is a genuine need for moneylending to social welfare recipients? There is no other source they can turn to at present as the banks and credit unions would require a savings record. Would the Minister not see that there is a gap in the present social welfare code which needs to be filled and perhaps rather than waiting for a global re-examination of the social welfare system, would she consider a pilot scheme in a particularly sensitive area?
I should like to reiterate what I said about the supplementary welfare allowance scheme being a flexible one. Indeed, a considerable degree of discretion can be exercised by community welfare officers. It might be putting the cart before the horse to try to change the social welfare system to deal with a system which the Deputy describes as imperfect. The rights and wrongs of moneylending are not a question for me, but rather a question for the Minister for Justice.
It will certainly not be a suitable question for Question Time.
I am not convinced that the social welfare system needs to be changed since it is flexible. I repeat that people who find themselves dealing with contingencies should first consult with their community welfare officer.
The question asked about contingencies. Is the Minister aware that a very serious contingency has newly arisen with regard to a couple over 70 years of age on a non-contributory old age pension of £40 per week — £20 per week each — who are living on their bank savings of £270 per month? Since the introduction of the DIRT tax, that amount has been reduced to £156 per month, a drop of £30 per week and they must wait until April to claim back this DIRT tax. The period between now and April is a very serious one for people in that situation. Could the Minister make some special arrangement to deal with such a contingency which is not created by moneylenders but by the Government in applying their DIRT tax to elderly people? This is something with which we disagree. Can the Minister suggest how these people could otherwise bridge that gap in the intervening period?
That question is very different from the one which was put down and I could not answer it. A separate question would have to be put down.
The question asked if the Minister would make special arrangements to meet a special contingency regarding loans from lending sharks. This raises the question of meeting contingencies generally. I want to draw the Minister's attention to this case.
The Chair feels that if all contingencies, which might run into hundreds, were brought up individually, it would be just out of the question to deal with them all here.
I can supply the Minister with the details, but I wanted to draw to her attention that this is happening as a result of the Government's DIRT tax. It requires action on the part of the Government.
I am calling Deputy Skelly.
Would the Minister accept that people on welfare assistance are not in a position to save? Would she consider supplying vouchers for people in these predicaments, to help them to pay their ESB, gas and other bills for essentials? It can also be extended to communion and confirmation expenses, shoes and other items. I share Deputy Bruton's concern over the effect of high moneylending rates on such people.
If the Deputy would like to put that suggestion to us, we shall look into it. The supplementary welfare scheme is, as I said, a flexible one. There is a provision for a once off payment to meet special needs such as the Deputy has mentioned. We have already considered that kind of contingency. If the Deputy has a specific suggestion to put to me, I shall be glad to consider it.
I am calling Deputy McCarthy and then Deputy Richard Bruton for the last question.
Would the Minister consider reviewing the guidelines for payment of supplementary welfare allowances? The once off special payment made in exceptional circumstances for essentials such as furniture, building, cooking apparatus and such is a very rigid type of guideline. Are there any plans in mind to make this kind of exceptional payment more flexible?
I am sorry that I cannot be more definite for the Deputy. I seem to recall that a review has been or is about to be, started on guidelines but I could not speak ex cathedra in case I am proved to be wrong. I shall look into the matter for the Deputy.
A final question.
Would the Minister accept that if tougher law enforcement comes in in this area there will be even greater need for some loan source for social welfare recipients? Where else does she suggest that these people can go to look for these loans?
This seems like an argument rather than a question.
But there is a connection.
It is an argument that the Deputy is conducting, rather than a question that is being asked.