Dáil Éireann debate -
Thursday, 10 Mar 1988

Vol. 378 No. 11

Social Welfare Bill, 1988: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. Wallace

The Bill provides special major increases for the unemployed. However, I am concerned to ensure that the quality and dignity of the service provided to people who have to rely on social welfare is of an acceptable standard. Even in the present tough budgetary times we must ensure that the less well off do not suffer indignities when applying for or collecting social welfare payments. In this regard I call on the Minister to ensure that the work on the new employment exchange for Cork proceeds with all possible speed. The two existing exchanges are inadequate to provide the kind of modernised, humanised and dignified approach we should be adopting in the latter years of the 20 century.

I appreciate the efforts being made by the Minister to improve the quality of the service in Cork. Last January he visited Cork employment exchange to inaugurate a new computerised payment system for the unemployed in Cork. I understand that this new development is part of the Minister's plan to make Cork a major link in his strategy to improve considerably delivery of social welfare services at local level. The new computer system enables computerised payments dockets and pensions to be produced in Cork while the claim information is stored on computer in Dublin. The two centres are linked by a telecommunications network. This new system will provide a number of benefits which I have been seeking for social welfare claimants in Cork. It will give better information on their claims, a faster response to changes in their circumstances and quick payment which is an essential development. It will mean more time and attention for claimants and it will increase the options for more flexible payment and signing arrangements.

The other benefit of the computerisation of unemployment payments in Cork is that it improves the Department's control of unemployment payments and helps to cut down on fraud and abuse. About £600,000 is paid out in unemployment payments at Cork exchange each week. Already 1,200 claims have been transferred on to computer and the remainder will be on by the middle of the year. Plans are in hand to extend this system to Cobh in County Cork.

The computerisation is central to the development of the comprehensive new service, the one-stop shop, which the Minister is introducing nationwide. Already several significant developments have taken place in this service in the Cork area following discussions I had with the Minister. Six months ago a facility was introduced in Cork which enabled sickness certificates to be entered on computer at the Cork exchange. This has speeded up payment of disability benefit to people in the Cork area. Now 2,500 sickness certificates are processed in Cork each week. Cork was the first location to have this new service and I hope it will be introduced in other locations from now on. Decisions on unemployment assistance claims which formerly were made at headquarters here in Dublin, causing a number of delays, are now all made in Cork. This approach, which was introduced in Cork on a pilot basis, is designated to cut down on the time taken between application and payment of unemployment assistance and is very welcome. A scheme which allows unemployment assistance to be paid without a further means test to people from families whose means have already been assessed by the Department is also in operation and results in a quicker and better service. On-the-spot means testing for unemployment assistance began in Cork in December 1987 and enables decisions to be taken on many applications without a home visit. I welcome that very much because people were waiting for up to three or four months for this investigation to be carried out. This procedure ensures that the time taken between claim and payment is kept to an absolute minimum. Already the new claims being dealt with in this way in Cork city average about 30 per week. In addition to Cork city this facility is now operating in Bandon, Dunmanway, Macroom, Mallow and Fermoy and throughout the county. It is a very progressive development.

These new developments are of major practical importance for people awaiting social welfare payments. They reduce delays inherent in sending claims to Dublin, they eliminate red tape and bureaucracy and mean that people concerned have money in their pockets more quickly to enable them to provide basic necessities.

The increases in social welfare rates contained in the Bill are a concrete example of our commitment to meeting the needs of people dependent on social welfare. Fianna Fáil have a great tradition of caring for the elderly, the sick, the disadvantaged and the unemployed. I am proud to be part of that tradition and to be here today to support the Government in the major advances we are making. The increase of 11 per cent in the lowest rate of payment shows clearly that this Fianna Fáil Government are prepared to take the action required to improve the lot of those on social welfare. While other political parties have spoken at length about the special needs of people on low payments, this Government are prepared, even in the very tough times we face at present, to make an additional £53 million available for those on long-term unemployment assistance and supplementary welfare. In the course of the budget debate the Leader of the PDs said such increases were not necessary. Lest there be any misunderstanding, I refer to the Dáil debate of 11 February 1988, column 1914. There was some reference yesterday to asking the Minister to withdraw some statement he made regrding this, but I want to quote the Official Report. Deputy O'Malley said:

. . . I have reservations about the increased payments of up to 11 per cent for the long-term unemployed. Every Deputy and party supports improving the lot of the long-term unemployed, but is this the best way to go about it? I do not believe so.

This is as clear a statement as one can get that the Progressive Democrats have no time for the less well off in our society. It reinforces the yuppie tag they received initially and which they have been trying to shake off ever since. This Fianna Fáil Government know that these people need help now and they are giving it to them.

Shortly before the budget major play was made in certain sections of the media about the need for a change in policy to make provision for welfare recipients on the lowest payments. The Government saw that group as a priority. The Programme for National Recovery provided that the Government would maintain the value of social welfare payments and give special increases to the lowest paid. The Government took decisive action and introduced a major change of policy to make special payments to this group of people. Yet the media have been silent. They should recognise these increases for what they are, a real transfer of resources to those most in need. The additional expenditure involved is about £30 million. This is a major boost, given the present constraints on the public finances.

While the Labour Party have been congratulating themselves on maintaining the value of social welfare payments during their period in Government, they made no special provisions for those on the lowest payments. In no area did they give increases of over 8 per cent in real terms as a special extra bonus to people they claim are most in need of special assistance. They simply gave increases to match inflation or slightly more. They talked about the great steps they took by setting up the Commission on Social Welfare. What happened after that? They seemed to recognise the need but took no action. They talked rather than acted. These increases, together with the special increases for children, are meaningful in money terms and will ease the burden on the more hard-pressed sections of society.

The Fine Gael spokesman, Deputy Jim Mitchell, appears to regard this Bill as very disappointing. How did he feel when he was a member of the previous Coalition Cabinet that made no special provision for people on the lowest welfare payments. Worse still must be his shame at the Fine Gael Government's decision to defer the social welfare increases in 1987 from July to November of that year. How can he seriously suggest that this Government are not concerned about the welfare of people on social welfare? His lack of concern is evidenced by his lack of action on behalf of the same people about whom he now professes to be passionately concerned. Where was that compassion when he was sitting around the Cabinet table? What special measures did his Government take to improve the lot of the less well off in society?

Deputy Mitchell is on his hobby horse when he talks about giving loans to people who are caught in the grip of moneylenders but is that the answer to their plight? Even if he considers that it is the answer, let me ask him what action he took during his period as a Government Minister to do anything about tackling this problem. It is time to face up to reality. This Government have taken more initiatives and decisions in the past year to improve and develop the social welfare system than the previous Coalition Government did in its four years in office. This Government care about the people and these increases and this Bill are clear evidence of that.

The Government's decision to extend social insurance to the self-employed is a major new development in social insurance. The Commission on Social Welfare recommend the extension of social insurance to introduce greater equity into the financing of the social insurance system. Even before the commission was established I understand the present Minister, Deputy Woods, had developed proposals for the extension of social insurance to the self-employed. In over four years in office the Fine Gael/Labour Coalition Government, were unable or unwilling to make further progress on this scheme.

The speed with which the scheme has progressed to the stage where we are considering legislation today indicated the type of decisive action which this Fianna Fáil Government are prepared to take. I congratulate the Minister and his colleagues on bringing this legislation before the House. I believe it is important that widows and old age pensions should be available as of right for people who are self-employed and who contribute towards the financing of the overall cost of social insurance. It is a move towards treating citizens equally so that the self-employed will enjoy the same rights as employed persons who have basic pension rights without a means test.

I am concerned, however, about the amount of misinformation that has been generated on this same subject. I will refer to two items. The first was an article in The Irish Times dated 19 February 1988 in which the headlines stated that this scheme would cost £800 million. This is totally incorrect. The economist author of the article appears to have based his assumptions on a fundamentally flawed basis with the result that his conclusions were way out of line. I am glad the Minister has dealt at length with this aspect of the matter in his speech. However, I would go further than the Minister and call on the person concerned to acknowledge his error and set the record straight from his professional viewpoint. His article received widespread coverage in other sections of the media. I do not have the detailed reference but it is only reasonable that an opportunity should be given to show the correct position. Lest anyone thinks I am being unduly harsh in one particular area, it is well to bear in mind that this article got widespread coverage and conveyed an impression, highly erroneous, that this scheme will be an intolerable burden on the taxpayer in the longterm. That is not the position. Furthermore, the assumptions in the article were used by a second economist in an article in Business and Finance magazine which, in effect, retraced the original heresy.

These views appear to have been taken on board by Deputy Mitchell and others without any checking or cross-referencing. The original author has a moral and, dare I say it, professional duty to acknowledge his erroneous assumptions as regards the income to be collected from the new system. If he has any doubts about the error of his ways I am sure the Minister would be only too pleased to advise him of the details. This should be done and done urgently.

The National Pensions Board with its acknowledged experts worked out figures based on actual calculations which showed that the particular economist has his figures wrong. Why he did not study that report, as appears to be the situation, is strange. I am not suggesting he has any improper motives or intention to mislead but he appears to have created a lot of uncertainty among people who have not studied the position and examined the facts.

A second item of misinformation I want to refer to relates to the advertisement published by the Irish Farmers' Association in the daily media shortly after the decision was taken to extend social insurance to self-employed persons, including farmers. That advertisement tried to create the impression that the self-employed were being unfairly discriminated against as compared to other groups. The IFA were alleging that civil servants were paying only 0.9 per cent for the same benefits that farmers would get for a higher rate of contribution. This is totally misrepresenting the situation. Established or permanent civil servants pay 0.9 per cent for contributory widows' and orphans' pensions, deserted wife's benefit and limited occupational injury benefits. Farmers will receive a contributory old age pension which is not payable to civil servants. The IFA, in a handbill which they are circulating calling for equal treatment and fair play for self-employed persons, including farmers, say that equity demands that all citizens should pay the same contribution for the same benefits. I believe that equity, morality and fair play also demand that the IFA should not seek to misrepresent the situation. The IFA deliberately misrepresented the position in relation to different groups in society. It is not true to say that the civil sevants get the same social welfare pensions as do the private sector employees or the self-employed.

Under the proposed arrangements social welfare insurance for farmers and the self-employed will come into operation from April 1988. The IFA stated that they would not accept the situation where the following contribution rates would apply for pensions: civil sevants, 0.9 per cent; private sector and some of the public sector 2.4 per cent; self-employed, 3 per cent, increasing to 5 per cent over two years; for contributory old age pension and survivors pension 66 years of age.

Civil servants are not covered for contributory old age pensions and, accordingly, they are not liable to contribute towards the cost of such a pension. They do, however, pay the correct rate towards widows' and orphans' pension. If the IFA are suggesting that everybody should pay the full rate of PRSI then that is a separate matter and I want to emphasise that. I understand from the Minister that the question of social insurance cover for civil servants is one of the items that will be examined by the National Pensions Board. In the meantime, it should be borne in mind that there is an occupational retirement pensions scheme for civil servants which provides the basic income in old age.

The Minister has dealt with the question of higher rates for self-employed persons and this seems reasonable to me. I fail to see how any farmer or self-employed person could argue that they should be treated as an employee. I can see the logic in the Minister's approach in not treating the self-employed as being both employer and employee. That would mean that they would be liable for the combined contribution. Self-employed persons are in a different category from employees. Employers pay a contribution in respect of their employees and it is unreasonable that the self-employed should pay at the same rate as an employee. The Government's decision to go for a higher rate for the employee but not as high as the combined employer-employee rate is a sensible and workable one.

On the overall financing of social welfare, I am concerned about the burden of PRSI on the lower paid. The Commission on Social Welfare have recommended that the upper income limit for contributions for PRSI should be abolished. The present Bill raises the upper income limit from £15,500 to £16,200. I would like to take this opportunity of asking the Minister to consider further raising this upper income limit. For instance, how much would an upper income limit of, say, £20,000 to £25,000 raise? PRSI is regarded as a regressive tax in that it bears more heavily on the lower paid. Some of the additional revenue raised should be used to provide an exemption for, say, the first £3,000 of income. This would ease the burden of PRSI on the lower paid and would not result in any cost to the Exchequer.

Members of the Opposition frequently quote from documents. In the Programme for National Recovery we made a commitment in regard to caring for basic values in social welfare in particular. Our intention is to continue improving the status, dignity and security of older people in the community. In regard to the pre-retirement scheme the over 60s and the long-term unemployed will not have to sign on at employment exchanges. This is a very positive step and is part of our commitment. We also stated that we would examine sympathetically cases where people fail to qualify for pensions because of a change in the structures of the system between 1950 and 1970. We are also implementing the pro rata pension scheme. All the conditions in our manifesto clearly show that in this area of social welfare, which is a very sensitive area where the most vulnerable sections of the community are affected, Fianna Fáil have taken a very positive line. We have implemented in a very short time, many of those conditions.

I congratulate the Minister. He has made tremendous progress in a very short space of time. I have worked very closely with him. I am glad he listens to what we have to say and as a result there are very positive provisions in this Bill which will affect people throughout the community.

Mr. Durkan

The merit or demerit of PRSI for the self-employed has for a long time been the subject of discussion. Generally speaking, most people will accept it as a positive and progressive approach. However, we have to examine closely the reasons for its introduction, the thinking behind it and the attainments at the end of the road. There are quite reasonable grounds for believing that perhaps on this occasion, meritorious though the principle is, the introduction may not have been for the best reasons. Was it introduced to achieve equality or was it for monetary reasons? Was it introduced on the basis that it could produce a certain figure within a certain space of time or was consideration given to the possible liabilities that it might place on the Exchequer in, say, ten or 15 years time. I am quite sure that the Minister, in considering this proposal, thought out all those issues fairly — I hope he did. We, on this side of the House, believe that, notwithstanding all that, there is still reasonable grounds for suspicion and for the belief that it may not well be the boon it is being held out to be by speakers on the opposite side of the House at present.

This Bill will eliminate the situation where people who are self-employed and self-sufficient all their lives find themselves, at the end of the day, having to be assessed to ascertain whether or not they can obtain a pension. It will eliminate the humiliation and, in many cases, hardship for people who are self-employed. Not everybody who is self-employed is a millionaire. Many of the people whom we all deal with on a daily and a weekly basis are small business people, people with car repair businesses, confectionery shops and so on. They are deemed as self-employed people, and they are self-employed but their income is very small. Many of them may have leased a shop all their lives and at the end of the day they have very little.

Generally speaking, the investigation branch of the Department of Social Welfare treat those people fairly. However, there have been instances where the applicant has not been able to identify exactly where his or her assets have gone. There are such things as expenditure and day-to-day expenses which very often elderly people are not able to identify, and figures appear for which they cannot directly and accurately account. The result is that they are assessed as having an income from the value of their assets. The value of their assets could be determined by property from which they cannot get an income or from an assessed amount of money for which there appears to be no account. In many cases that has caused serious hardship. While I accept that the investigating officers generally have been affable and amenable to representation, discussion and explanation, there have been instances where that has not been the case and the sufferers have been the applicants. This Bill, if it works as it is intended, should eliminate that problem.

As other speakers have said, the benefits will be that the Exchequer will get a contribution from the people and in turn those contributors will have something put by for retirement as opposed to the present system whereby they have to rely entirely on the State. However, there is the important factor in relation to contributions, that of contributing in line with the benefits they will receive. There is a serious doubt as to whether the level of contribution is correctly related to the benefits they will receive under the provisions of this Bill.

There is considerable confusion, stress and worry felt by many people about the provisions of the Bill, people who will ask themselves the very serious question whether — having regard to what should be a constructive and progressive piece of legislation which would cater for them at retirement age and, at the same time, alleviating some of the burden ordinarily placed on the State — it might well turn out to be another source of taxation? For example, could they find themselves contributing over and above the level of benefits they will receive when they reach retirement age? I believe there is a strong possibility of that. While I accept the principle involved, I have serious doubts about the benefit to one side or the other at the end of the day. It could well mean that a whole bureaucratic system could become involved, resulting in the taxpayer finding himself paying more and the hopeful beneficiary finding himself in a similar position.

A number of speakers on the opposite side of the House have lauded the present Administration — I will make no personal reference to the Minister present — in regard to the social welfare benefits at present available. That is true; we are a caring society. I admit freely that at present the Government are probably doing what they can to alleviate the burden on the unemployed and the less well off in our society. However, it should be remembered also that approximately 37 per cent of our population is in receipt of social welfare benefit of one kind or another at present. If one takes into account the vast number of people in receipt of unemployment benefit and assistance, then one must identify and realise the very large burden it imposes on our economy. On the one hand, while we can pat ourselves on the back and say we are a caring society, that we look after our people, those who are less well off in our society, that we provide for them, their children and so on, on the other hand, it is a very sad reflection on our society that there are so many people in need of these benefits at present. We have no reason whatever to pat ourselves on the back when we see all of the people around us, for example, all of the people who visit our clinics weekly who experience serious hardship. I might also point out to the Minister — and here I mean no reflection on him whatsoever — that since I first entered public life I have never experienced the volume of queries week after week from people who ordinarily never had to have recourse to social welfare, good, bad or indifferent, and certainly never had to have recourse to a public representative to make their case.

I had the experience within the past few days of meeting and talking with a PAYE worker/contributor practically all his life, over a period of 25 years. Fortunately he had never been ill and had never drawn unemployment benefit or assistance. A couple of years ago he was made redundent but he did not lie down under the burden. He decided to invest his redundancy money in a new venture along with a partner. Of course, he had to put up security. It so happened that the business did not go well and is now on the point of closure. Of course the bank hold his security. He has now had to get out of the business. He has a wife and three children. He has been refused unemployment assistance on the basis of his alleged assets but the alleged assets in his case cannot be touched, they are held as security by the bank. Therefore, when and if the business flounders the bank will move in and collect those assets. That is a supposition on which his social welfare assessment is now based. If the bank do move in and collect those assets. That is a suposition on which his social welfare assessment is now based. If the bank do not move in and collect the assets then he will get whatever remains of that security at the end of the day. In the meantime he has been refused social welfare assistance: a contributor over a period of 25 years is not in a position to get his just payments for all his contributions. Therefore, he has had to resort to supplementary welfare payable by his health board when there is another assessment system that comes into play.

I must say that the Minister's proposal in regard to the one-stop shops is welcome and will eliminate a great deal of duplication. Now that this Bill is before the House I ask that the Minister would examine carefully the effect of this and other legislation in relation to assessment for pension or benefits of one kind or another where such is found to be necessary.

There were a number of references to training schemes, unemployment and so on. Here I might make a passing reference. I have always felt that in times of high unemployment it is much better to train people, to have them engaged in training of one kind or another than have them unemployed. It is much better to have them, as it were, continue their education in some kind of a training scheme, the results of which will be of some benefit to them later rather than have them sitting on the unemployment scrap-heap with nothing to do and no purpose in life.

Notwithstanding the cases made by a number of speakers on the opposite side of the House in regard to the Jobsearch programme and various other new-fangled investigative practices now being pursued by the Department of Social Welfare, if a little more time and effort were devoted to the work of FÁS it might have the advantage of eliminating some of the problems encountered in relation to unemployment, allowing people who are unfortunate enough to be unemployed to continue training or education, thus benefiting therefrom.

With regard to the conditions and manner of payment of various social welfare benefits, could we not devise some system whereby payments could be made other than as obtains at present when people applying for unemployment benefit and assistance must queue up at local employment exchanges, many of them decrepit, unsuitable buildings, there for generations, where there is absolutely no provision for privacy, for protection against the weather and, most important of all, no regard to people's dignity and self-respect. It is something to which a great deal more thought should be given. Some people now applying have found themselves in need of social welfare benefit for the first time ever. It must be accepted that those applying for unemployment benefit, social welfare assistance or whatever do so not by choice but rather out of necessity and at least they should be able to attend at a building that affords some recognition of the need to preserve their dignity. I will speak at greater length about that matter some other time. Unfortunately, the tragedy of the present economic climate — and here I do not blame the Minister personally — is highlighted by the example of the individual who had been reasonably well off up to the time he or she had to apply for benefit of one kind or another. When they did not qualify they had to apply for supplementary welfare and for the first time they found themselves in a long queue which appeared to them to be a very impersonal queue. In many cases they could overhear the discussions which took place with other people in the queue. They felt that their dignity, privacy, pride and whatever else they had left was being eroded by becoming involved in that process. That did more to kill their spirit and initiative than perhaps losing their jobs had done beforehand. I ask the Minister to give some consideration to that area in the context of the legislation now before us.

Before I conclude, I should like to say again that not everybody who is self employed is wealthy and that the supposition that they are should be well and truly scotched. Those who are self employed and wealthy do not have any need for pension schemes. They are capable and able to provide for themselves in the ordinary sense whether or not a compulsory scheme is introduced.

If the purpose of the scheme is to glean more money in order to balance the books and to provide a satisfactory out-turn at the end of this year or at the end of next year, it is being introduced for the wrong reasons. I also hope that it was not used as a bargaining factor in the preparation of the Programme For National Recovery or on the basis that, “if you produce one element we will produce another.” I hope it is being introduced in order that equity will prevail in the social welfare system that there will be a provision whereby people outside of the PAYE sector can contribute directly to their retirement pensions and that, as a result, the present system of assessment and counter-assessment, of claim and counter-claim can be eliminated. If it is being introduced for those reasons, it is being introduced for the right reasons. I hope that is the case.

I know a self-employed person who had a very small business. When he retired he applied for an old age pension but he found himself with the old story that allegedly he had assets. Oddly enough, when he retired he decided to sell his home and move elsewhere and he found himself in a very awkward situation with regard to the title of the property he purchased. He was stuck with bridging finance for something like three years. This is a very unusual situation but it did happen. Very often people of 65 years of age or more find it very difficult to explain clearly to an investigating officer exactly what they did with every penny and pound they had. Obviously, this man was not able to explain what he had done with his money and he was awarded a reduced pension of about £25 per week. Representations were made on his behalf in all good faith, as was the response I might add, but it was discovered that he had been overpaid and, following a reassessment, his pension has been reduced to £10, despite the fact that he has no assets whatsoever, that the profit he got from the sale of his previous house was lost in the subsequent long transaction which took place and the hardship and trauma it caused him. That man is now deemed to have assets of somewhere in the region of £16,000 or £17,000, which he simply has not got. His next option is to apply for supplementary welfare benefit but I do not think it should happen that way. There should be no necessity for all that trauma.

On reaching the age of 65, one would hope that one would be entitled to some kind of recognition for a long life of effort and contibution to the community, society and the economy. One would expect better treatment at that stage than the kind of treatment that is being meted out to this individual. We hope that the passing of this legislation will eliminate once and for all that kind of nonsense.

Mr. Foley

I welcome the opportunity to make a brief contribution to this very important Social Welfare Bill. I congratulate the Minister on the Bill as it provides for a number of important improvements in the social welfare system. In his presentation of the Bill, and from my discussions with him, I know that the Minister's main concern at all times is for the weaker sections of our community. This comes through very forcibly in this Bill.

The Bill comprises four parts and its main purpose is to provide for the increase in the rates of social welfare payments and other improvements in social welfare schemes announced by the Minister in the budget, and for the extension of social welfare to the self-employed. Provision is also made for the introduction of a pre-retirement allowance for the long-term unemployed. Expenditure on social welfare during 1988 will exceed £2.6 billion. Other startling figures show that in excess of one million people are involved in social welfare payments. Section IV of the Programme For National Recovery commits the Government to maintaining the overall value of social welfare benefits and also indicates that special provision for greater increases would be made, where funds would be available, to those receiving the lowest income payments.

Abuses of the social welfare schemes have been highlighted by the Comptroller and Auditor General. As a member of the Committee of Public Accounts, since 1982, I can say that his reports have shown various frauds which have been detected within the system. In 1985 an examination of pension files was carried out by his office and this brought to light a number of cases in which books of warrants had been issued for the payment of pensions at higher rates than the claimants were entitled to. The Department, when questioned by the Comptroller and Auditor General and his staff, claimed that the cause of this problem was the changeover from a manual to a computerised system and that most were due to misfiling of stencils which were used to impress the claimants names and addresses on the pension books. The overpayments detected amounted to approximately £33,000 but I wonder how much was not detected.

Various efforts have been made to tackle this problem and I am satisfied that the Minister is doing this. I am satisfied also that he has the full co-operation of the staff in his Department. They have made a determined effort to stamp out this type of petty fraud. This will increase the fund for genuine and deserving cases. I appeal to the Minister to further streamline the method of accountability within his Department. I have been told that there is only one financial comptroller but I believe there should be at least six and I ask the Minister to consider this. I appeal to the Minister to consider the possibility of regional centres dealing with claims, such as special disability claims, on a computerised basis. In this way there would be a direct link with Dublin and a lot of overlapping would be eliminated.

The appeals system is also a cause of concern and I hold that an applicant should be given the full facts relevant to his or her case in the event of a refusal, especially when a further appeal is involved. Due to the present unemployment problem many families on benefit are allowing children over 18 years of age to continue in full-time education and, as a result, they are being deprived of benefit. This is very widespread throughout rural Ireland. Their only hope of allowing them to continue for a further year or two is if they qualify for some type of assistance.

Changes in the family income supplement scheme under section 5 provide for adjustments in the scheme as a consequence of the general increase in rates. The maximum weekly family income for entitlement to the family income supplement in the case of a one child family is being increased from £104 to £108. The increased rate for each additional child up to and including the fifth child is being raised from £22 to £23. This will come into force on 28 July. This is a step in the right direction. A married man with five children, earning £150 a week, can now claim £25 a week in family income supplement, bringing his income to £175 a week. This is a further incentive to people to work and I hope that the scheme will be published so that people who qualify will be made aware of its existence.

Provision is also made under the Bill for the extension of the social insurance scheme for the self-employed. For the first time, the self-employed would be covered by contributory old age and widows' and orphans' pensions. Under that system they will be liable for social insurance contributions. The self-employed and farmers have been calling for years for some form of contributory scheme and I am glad that the Government have responded in a very positive way. Up to now the less well off in these categories have had to rely on the various social assistance schemes and that cost is met directly out of general taxation. In 1987 this figure was estimated to be in excess of £320 million. The direct contribution to be made by the self-employed and farmers to the cost of social welfare payments will reduce the burden on the general taxpayer, not just in the early years when income from contributions will greatly exceed the benefits being paid out but also over the long term. I also welcome the decision to phase in the contributions over a three year period. The care and commitment of the Government was shown by starting off with 3 per cent in the first year, increased to 4 per cent in the second year and 5 per cent in the third year.

I agree with the statement of the Minister that a good social insurance scheme should be comprehensive and all-embracing. All must contribute and there can be no provision for the better off to opt out. The Bill makes special mention of the dental and optical scheme. I appeal to the Minister to pursue and improve the facilities for dental and optical treatment for spouses and I welcome his decision to implement the scheme for dependent spouses of insured workers. I understand that in excess of 18,000 women have submitted claims for treatment and that now 150 dentists operate the scheme, together with all opticians throughout the country. These figures indicate how important it was to extend dental treatment to dependent spouses, mainly housewives working in the home.

Last year, the Government co-ordinated the work of National Manpower, AnCO and social welfare under the auspices of FÁS. This has proved to be in the best interests of the long term unemployed; out of it developed the national Jobsearch programme which is already a tremendous success. The figures are so impressive: 141,500 on the live register were interviewed to help them assess their strengths as prospective employees and assist them in their search for employment. Of these, 40,400 were placed on Manpower schemes, AnCO training courses and the Jobsearch programme and approximately 5,000 found suitable employment. When invited to avail of the Jobsearch programme, 12,700 left the live register. The national Jobsearch programme, as a result of its success in 1987, is to be continued. It has been of direct assistance to many thousands in their search for work. The co-ordinating effort of it services has provided a better service for the unemployed. Many of them, having completed one or more of these courses, agree that it has given them more confidence in seeking employment.

I also welcome the Minister's commitment to the voluntary social services organisation and their assistance to many of these bodies through the voluntary great scheme. Many people caught in the poverty trap need more than just financial help. These courses help in a practical way to resolve their financial problems. The Deaf and Handicapped Groups of Kerry have made a very comprehensive report to the Minister for facilities in Kerry for deaf children, in particular for educational purposes. At the moment these children travel each week to Cork and Dublin for such facilities. I hope the Minister will respond positively and make a commitment.

I welcome the Minister's suggestions about the Combat Poverty Agency to examine many issues that are facing that agency. He has asked them to come back very quickly with suggestions. He mentioned, in particular, the question of the moneylenders who are the scourge of the weaker sections of our community. Any steps that the Minister could take to resolve the situation would be most welcome.

The Government have decided to provide pro rata pensions for elderly people who did not qualify for contributory pensions because of the method of calculating entitlement. This anomaly resulted from changes in the income limit for social insurance contributions between 1953 and 1974. As a result of these changes, some people who became insured in 1974 did not qualify for contributory pensions because of gaps in their insurance records. The Minister intends to rectify this problem. Those who are affected by the anomaly will now be able to claim a pension. The rate or pension they receive will vary depending on their contributions. It is estimated that some 1,200 elderly people will benefit from this improvement, which will come into effect in October. In introducing these provisions, the Government are also implementing one of the recommendations of the Commission on Social Welfare who suggested that those affected be given old age and widow's pensions on a pro rata basis.

The Fianna Fáil election Programme for National Recovery stated that Fianna Fáil in Government would maintain the value of social welfare payments. In the national plan agreed with the social partners last year, this commitment was reiterated. Indeed, the plan went further and said that special efforts would be made to give higher increases to people on low social welfare payments. This Government, in keeping with the great and proud Fianna Fáil tradition, have more than met that undertaking. Increases have taken into account the cost of living and it is a clear statement of our concern for these people in our community who are forced to rely on social welfare to meet their needs. Part of the agreement prior to the budget was the need to redistribute resources to social welfare beneficiaries. This Bill gives the first real distribution designed specifically to meet the special position of those on low payments. I am satisfied that this Bill is in keeping with that commitment to the weaker section of our community. I welcome the Bill and again congratulate the Minister, as it has improved the position of social welfare recipients. I recommend it to this House.

Mr. McCartan

I am happy to have the opportunity to contribute, on behalf of The Workers' Party, to the Second Stage debate on the Social Welfare Bill, 1988, a Bill designed to implement the budget proposals for the coming year. I already had the opportunity to make some remarks to the House with regard to the very disappointing aspects in the proposals when the budget was being debated in its general form in the days and weeks after its announcement.

The Bill helps us to concentrate more precisely on many glaring omissions, the failure to address social reality and inflated claims made by the Minister and the Government in regard to the perceived improvements in the welfare scheme generally. Indeed, the Minister in his opening remarks referred to the Bill as the most comprehensive social welfare legislation since the early seventies. He should be reminded of the Social Welfare (Consolidation) Act, 1981, which must be——

Dr. Woods

That was purely a consolidation Act.

Mr. McCartan

That Act must be the most comprehensive social welfare legislation ever enacted. The 1988 Bill is a piecemeal document and could not be considered comprehensive or progressive. If it was comprehensive, one of its first objectives clearly would have been to contribute to a streamlining of the welfare code, a feature which has been looked for for so long by people who have attempted to cope with and to advise those coping with the welfare code.

Until recently, there were 40 categories of different entitlements and 32 rates of payment. This Bill in some respects increases the number of categories and rates of payment. It is quite the opposite of comprehensive. It does not address one of the most fundamental problems highlighted in the report of the Commission on Social Welfare, the need to rationalise and to make the social welfare code easier. The Minister was slightly carried away with his notions of the fundamental improvements which the Bill suggests to him. In his budget speech, the Minister emphasised the very generous increase in the level of increased payments across the board of 3 per cent and as high as 11 per cent in respect of the long-term unemployed and other like recipients.

The whole approach of percentage increases is fine if one accepts that the base figure increased by the percentage is itself a fair and just payment. The report of the Commission on Social Welfare clearly indicates that, even with the 11 per cent increase, we are only two-thirds of the way to the level recommended as a fundamental base in August 1986 when the report was published. We are far out of line with the recommendations of the commission after very comprehensive investigation by them. It must be understood that a small percentage of an inadequate payment remains inadequate.

The first thing that the unemployed and disadvantaged want is work. I know this point is not relevant to the Bill but it must be mentioned in any debate on payments to the unemployed. The economy needs people to be employed because social welfare payments are the biggest single annual drain on our resources. We pay more in servicing that bill than in servicing the horrible national debt about which we so often talk. The only way we will ever decrease that level of payment is by creating jobs and paying people to work.

The Minister contends that the Government are committed to maintaining the overall value of social welfare benefits. In the context of the 11 per cent increase and the generous overall 3 per cent increase, one must compare them to what happens in other areas relating to prices. The Government give with one hand but they readily and quickly take it back with the other. They propose rent increases for local authority tenants, they have increased the cost of ESB bills by the imposition of VAT. They have allowed increases in bus and other public transport fares and they have not stemmed the rising cost of food and other items of household needs. Inflation continues to rise although we are told that the rate of increase compensates for this. The increases to social welfare recipients are miniscule compared to the increases they must carry in charges right across the board, including charges to hospitals and all the services at local level. The Government cannot maintain they are sustaining the overall value of social welfare benefits which are falling behind in real terms. That cannot go unchallenged in this debate because it is another vaunted claim by the Minister in regard to his proposals in the Bill.

The Minister referred to the Bill as comprehensive legislation but I am immediately struck by the division that exists between urban and rural rates of payment. There is a glaring anomaly in the Minister's constituency, which I have the duty and honour to share with him. There are streets within half a mile of where the Minister lives where people on one side are entitled to — and get — the urban rate and people at the other end who get the rural rate. I wrote to the Minister recently instancing a case of a man who moved to a house no more than a few hundred yards from where he had lived previously. Because of that, his entitlements under the social welfare code dropped by £12. The only change in the circumstances of that individual was that he moved to a house a short distance up the road. It is admitted that this disparity existed in areas divided for administration purposes between Dublin City Council and Dublin County Council but since 1985 all that area has been administered by Dublin Corporation. More particularly, all of it has been urban-based and consists of urban land. Those who reside there live under the same conditions as people in provincial towns.

I wonder why a rural rate applies to any person who lives in Dublin city or county. It is ridiculous that it should be so in this day and age when those who live on the periphery of the greater Dublin area must pay more to survive. They pay the same local authority rents but they are obliged to spend a lot more on bus fare to avail of the services in hospitals and other State agencies which are based in the city centre. However, because of an anomaly in the social welfare system, they are paid under the rural rates scheme. People living in the Minister's constituency are affected by that anomaly.

When dealing with a piece of legislation which has been described by the Minister as the most comprehensive Social Welfare Bill since the early seventies the Minister should correct that anomaly rather than sending me a letter to the effect that he was investigating my complaint. He has an opportunity to deal with the problems I have highlighted. I have no doubt that those who suffer as a result of the anomaly would greatly appreciate a change in the system.

Another matter in need of urgent attention and which should be dealt with in a comprehensive piece of social welfare legislation is the inexplicable discrimination against widowers. They are paid at a rate below single mothers and widows. I cannot understand why that anomaly is allowed to continue. The origin of the idea, based on anachronistic notions, was that a man while he lives alone through the misfortune of the demise of his wife nonetheless had a better chance to provide an income. The Minister should address that problem. I have no doubt that he, and many Deputies on the Government side, have encountered the phenomenon of widowers who are discriminated against simply because they are male. I do not know why it is taking so long to rectify that wrong.

It is regrettable to read again that single mothers will be involved in the next stage of the great charade and the hyperbolic claims of the Department that they will tackle fraud. Such people have been singled out by the Department for special attention in their efforts to halt fraud. One of the problems in regard to this is that there is a perception about that single parents because they cohabit or share a dwelling with another adult are being maintained or in some way assisted by the cohabitee. That is not always the case, if at all, but little consideration is given to it by Department investigators when considering the entitlements of such people to benefit. I reject the suggestion that such people should be singled out for special attention by investigators. I do not believe they are any more at fault, if we are talking about fault, than any other group in society. I reject the notion circulated by very conservative and Right-wing commentators — thankfully, it is a view that departed from this Chamber when the likes of Deputy Glenn was not re-elected — that single mothers purposely get pregnant as a means of getting a maintenance allowance. I must point out to the Minister that if he and his officals insist on cutting back on the allowances paid to single parents the ones to suffer will be the children.

The increase in the allowances for children are insufficient. We have been told that the Minister proposes to streamline benefits. The word "streamline" is a buzz word used in connection with what has been described as comprehensive legislation which ignores more than it addresses. It is important that we should consider in detail the Minister's efforts to tackle what has been described as fraud in the social welfare system. In the Dublin North-East constituency which the Minister and I represent it appears there is a concerted attack on young people who are drawing social welfare unemployment benefit or assistance. It is clear that a decision has been taken at Ministerial or Government level not to tolerate or accommodate young people drawing social welfare assistance. That is the only conclusion I can come to.

Mr. N. Treacy

That is not true.

Mr. McCartan

It is the only conclusion I can come to when I hear people at my clinics say that for no apparent reason, and in the face of incontrovertible evidence, decisions are being made by Department of Social Welfare investigators not to pay young people assistance. They appeal to the appeals officers and leave happy in the knowledge that they have put their case on the table but some days or weeks later they are advised that their appeal has been refused.

Mr. N. Treacy

Not all appeals are refused.

Mr. McCartan

It is important to remember that a person who has an appeal rejected is no longer entitled to social welfare assistance from the Eastern Health Board. In other words, they are cut off from that benefit and there is no point in them going to the health board or the Department for help. Many parents have told me that they must put their children who are not contributing to the family income out on the road because they cannot cater for them on the paltry sums they receive.

The form of notification issued under section 138 of the Consolidated Act to a young constituent on 26 February states that the applicant is not genuinely seeking and unable to obtain suitable employment. The Minister might look at the provisions of section 138, particularly the wording of paragraph (1) (b) which lays down the conditions which a claimant must satisfy. It is provided that he must be capable of work, available for work and genuinely seeking it but unable to obtain employment suitable for his age, sex, etc. For some odd reason the conjunctive word "but" has been converted to "and". Therefore the declaration from the Department of Social Welfare is to the effect that the applicant is not genuinely seeking employment and is unable to obtain it. It suggests that the failure of the applicant to get a job is due to some fault of his or hers. This is insulting in its present form. The Minister should look at the wording of the Act and at least carry out a cosmetic exercise in the interest of being a bit more diplomatic. These rubber stamped documents are sent out to people telling them they are no longer entitled to social welfare, without any grounds being given.

I am sorry the Minister for Social Welfare has left the Chamber. I want to tell the House what he told one of his constituents last Saturday at his Baldoyle clinic. A gentleman went to him along with two others to explain the difficulty he was having as a labouring man in finding work in the Dublin area. He had brought in notes and cards of refusal from employers in his locality. He told the Minister that he could not find labouring work in Dublin although he had been a labouring man all his life. He produced the evidence which he had brought to the Department of Social Welfare but he had been unable to get assistance because, he was told, he was not entitled. The Minister's reply was that there was plenty of work for labourers in England. That exemplifies the attitude of this Government when they talk about the care of the unemployed and those who must live on social welfare because they are in need.

Mr. N. Treacy

Ridiculous. The Deputy must have sent him in.

Mr. McCartan

I did not send him in but he came very quickly to me with 22 other people from the constituency.

Mr. Roche

It is a pity the Deputy waited until the Minister left the Chamber to bring up this matter.

Mr. McCartan

It is on record and I will repeat it to the Minister at any time.

Mr. N. Treacy

It is undignified.

Mr. Roche

It is a disgrace.

Mr. McCartan

The Minister left the Chamber of his own choice. I wonder what the Leas-Cheann Comhairle is doing in terms of calling the House to order and allowing a Deputy to continue uninterrupted, a matter about which I and others on these benches are constantly reminded.

An Leas-Cheann Comhairle

The Chair exercises an impartiality towards all Deputies in the House. I had contemplated indicating to you that in respect of the charges you are making against the Minister, which to me savoured a bit of, dúirt bean liom go ndúirt bean léi, it might have been better and more courageous if you had made them in the presence of the Minister.

Mr. McCartan

The Minister leaves the Chamber. What am I to do? Walk out after him? I am here to speak and if he does not want to listen to me that is his business.

Mr. N. Treacy

The Deputy should not be facetious. He is in the House of Parliament.

An Leas-Cheann Comhairle

Deputy McCartan can be quite sure that in respect of interruptions I will give him the same protection as I require on occasions when he makes so bold as to interrupt other Deputies. I would ask him to proceed now.

Mr. McCartan

That is not just an attitude of the Minister for Social Welfare. This position was first declared by the Minister for Foreign Affairs, Deputy Lenihan, and represents an endorsement by the Government of emigration as a solution to work problems. It is now becoming a reality to young people in my constituency. A young man came to me the other day with an envelope so large that he could not carry it in his pocket. It contained cards from people stating he had called looking for work but that none was available. The man was refused assistance and when he appealed he was also turned down. In the face of overwhelming evidence produced by claimants to the Department of Social Welfare, there is a clear policy which can only come from ministerial or Government level to deny people as far as possible their proper entitlements and to remind them that the boat and the plane are there to enable them to go elsewhere for work. That pattern exists and must be forcefully challenged.

Another aspect of this uncaring double dealing is the decision repeated in the Bill not to introduce increases, small and inadequate through they are, until 29 July. During the last election campaign I attended a meeting in my constituency on 9 February at which Dr. Woods gave an unequivocal guarantee to the Darndale Unemployment Action Group that as Minister for Social Welfare he would redress what he described as the very unfair system of delaying until later in the year the introduction of increases announced in the budget.

Mr. Roche

He has redressed it.

Mr. McCartan

He promised to introduce them in April but the increases this year are being delayed almost until August. It is typical of the pettyminded approach which has to be seen for what it is. The allowance for children's footwear was introduced by the Minister in mid-September, two weeks after the schools had opened and long after parents had already bought shoes for the new school year.

One of the points I want to raise very quickly in regard to fraud is that for every person accused of defrauding the system there are at least ten who are not getting their full entitlement. I agree that people who are receiving payments to which they are not entitled should be confronted but if the Minister is going to police the system he should also promote it and inform people fully of their entitlements. He should see to it that those who are being underpaid receive their just pay.

There is one small curious provision in the Bill which I ask the Minister to look at and that is the intention to deny the courts the opportunity to impose the Probation of Offenders Act on persons found in default. That Act may not be imposed until they have paid back the full amount of money. That is unrealistic and what will happen is that proceedings will be protracted and carried on for an inordinate length of time. It will also mean that lawyers will be paid more through the legal aid system to defend them. What could happen is that a justice may say that he will not impose the Probation Act but that he will impose a nominal fine of £5 in order to get a case off the list. The Probation of Offenders Act often provided a useful means for the courts to allow the pre-existing arrangement between the Department and the defendant to repay the money. Many times I have seen repayments start six months before a case is actually brought. That is a small point which should be looked at.

In conclusion I would like to refer to what the present Minister for Agriculture and Food, Deputy O'Kennedy, said so succinctly in a speech in this House on 29 January 1986 on the Budget Statement. He said that any Government who ignore the plight of the growing number of the unemployed, the sick and those dependent on our economy, can expect an angry response not just from those social welfare dependants but from all of society. Those words are a timely reminder to any Minister for Social Welfare and any Government that they must take seriously the plight of the unemployed. People will become angry and are becoming angry and I hope the Minister will respond to some of the points which have been made in this House.

Dr. Woods

I would like to take this opportunity to totally refute the allegation which has been made by Deputy McCartan about the clinic which I held last Saturday. What he said was totally false and untrue. I know he alleged that somebody else made the statement to him and I want to inform him that it is not true. I would not like him to leave the House thinking that it was. He made a reference to people he said came to meet me at my clinic on Saturday last and that I suggested that they seek work in England. That is totally false. I never said that, I would not say it and I ask him to withdraw it."

Mr. N. Treacy

He should withdraw that allegation.

Mr. McCartan

I take the Minister's word on the matter but that fact was put to me in writing and I will pursue it. I will clarify the position as far as possible to my satisfaction.

Mr. N. Treacy

Withdraw what you said.

Mr. McCartan

Certainly, I am not prepared at present to withdraw what I said.

Mr. N. Treacy

That is a disgrace.

Mr. McCartan

I fully accept the integrity of the person who came to me as much as I fully accept the integrity of the Minister.

Mr. N. Treacy

He should withdraw it.

An Leas-Cheann Comhairle

If, in the circumstances, the Deputy is not disposed to withdrawing the charges which he made against the Minister the Chair must take it that that is a matter for the Deputy and his own conscience. I now proceed to call on Deputy Dick Roche.

Mr. Roche

Politics are debased by the sort of performance we have just witnessed. I find it difficult to understand how a man who claws £105,000 a year out of the system as well as a Deputy's salary can lecture and hector us on poverty. What does this yacht-owning, silk-tie wearing gent know about poverty? Political promises are becoming a debased currency but no more debased than are the promises which come from The Workers' Party. That party promise everything in the safe and secure knowledge that they will never have to deliver on anything. In addition to the untruth he peddled about the Minister, Deputy McCartan stood here for a half an hour and misrepresented and sought to rubbish this progressive legislation which, if he had an ounce of sincerity in his body, he would have found some reason to welcome.

The protestations of concern for the poor from Deputy McCartan have all the sincerity of a kiss from a lady of the night. He comes from a discredited party. He is a mountebank and a carpetbagger of the worst order to come into this House and peddle that sort of nonsense. Let me pick up one of his misrepresentations of fact. In connection with the problems of families dependent on social welfare he referred to hospital charges, rent increases, service charges and a variety of other issues. As Deputy McCartan knows and as we all know, rents can be and are abated by the local authorities taking into account the income of the family concerned. If unfortunate families depending on social welfare in Deputy McCartan's constituency were foolish enough to seek his advice — I am not appraised of this fact — then Deputy McCartan is not well representing their interests. As we all know those who hold medical cards are relieved of hospital charges and all local authorities operate a waiver system. I am aware that Deputy McCartan knows this and that he is energetic in pursuing it. So I am at a loss as to why he should try to misrepresent the facts as being otherwise.

This Bill is welcome. To my mind it is very progressive legislation. It does not bring us to the end of the road with regard to all that can and should, and undoubtedly will, be done under the guidance of this Minister. The Bill contains many items for which to commend it and I will deal with a number of points, nine in all, in relation to the Bill.

The first point I wish to make is in relation to the general increase of 3 per cent in widows' and old age pensions, unemployment and disability benefits and in all other weekly payments. This increase has been downgraded and dimissed but as the rate of inflation is expected to be below 3 per cent it is a very welcome increase. It is also welcome that it will be paid in July rather than in November as was the case. As I have said on a previous occasion in this House, we would all wish that we could pay it earlier in the year and I have no doubt that the Minister is working in that direction.

The second proposal I would particularly like to deal with relates to the special arrangements for the low paid. To my mind this is a progressive and very welcome step forward. This is the first time that the position of people on those low levels of payment has been directly tackled by any Government. The payment of an additional 11 per cent recognises the special needs which exist among those who find themselves at the bottom of the ladder. I accept, and other Deputies should acknowledge, that this welcome improvement does not come cheap. It will cost the State and the taxpayer, who ultimately will pick up the tab, £31 million and no one will find fault with that.

Deputy McCartan also referred to the streamlining of the child dependant rates with extra payments at the lowest levels. He dealt with this matter in a rather disparaging way. As the Minister said earlier there are 36 different rates of increase for child dependants. That is ludicrous and impossible to understand. I imagine it is virtually impossible to administer. The commitment of the Government to streamline this area is welcome particularly as it will mean that those who are at the bottom of the list will make some, albeit marginal, gains. As I have already said, the Government this year, like last year, will pay the increases earlier than was the case with the previous regime. The increases this year are to be paid from July rather than from November and that, despite the griping comments of Deputy McCartan, is an improvement.

The Bill also extensively deals with the question of PRSI for the self-employed. Part III of the Bill is devoted to this issue. The extension of insurance to the self-employed is something which must be welcomed because it is an important administrative and progressive change in the social welfare system. Arguments against PRSI for the self-employed which have been circulated are a combination of bluster and actuarial nonsense. I speak in particular of the contribution of Deputy Jim Mitchell. At present 70 per cent of those who were formerly self-employed qualify for some form of social assistance pension. There are payments to which these people have not directly contributed. This is clearly unjust to the general body of taxpayers who contributed £331 million to these payments last year. The scheme introduced will bring equity into the social insurance scheme and surely that should be welcomed by anyone who is fair-minded. It will mean that for the first time the self-employed will be contributing to their pensions. It will also create pension rights, and that must be welcomed. The concept that has been canvassed, that we should allow some people to opt out of the system is not acceptable. The pensions system should be as wide and as uniform as possible.

Arguments have been made that this will operate as a drain on the Exchequer and on the general taxpayer. As the Minister has already outlined, the new scheme of social insurance for the self-employed will at the very least meet costs if we take it over a 50-year span. The additional cost of the scheme introduced here will be £6 million by year five. That will gradually increase to £21 million in year ten and the actuarial tables will show it will extend to £89 million in year 50. Income from the scheme will be £50 million in each of the initial years. In the first decade there will be an accumulated surplus well in excess of £360 million. These are the actuarial facts. It is difficult, therefore, to understand the basis in logic of some of the arguments put forward by Deputy Mitchell.

The Bill makes important provisions regarding fraud and abuse. Notwithstanding what Deputy McCartan said, if there was some way in which we could look into his soul and find out what he would like in justice for the taxpayer and for the poor I am sure we would find that he would welcome all the provisions that were introduced here with regard to fraud and abuse. Sections 19 to 22 contain a whole series of important measures in relation to prosecution proceedings, fines and jail terms for those who transgress. These provisions have much to commend them and they should be welcomed. A criminal is a criminal no matter what class he comes from, whether he is an employer who fraudulently encourages a worker to abuse the system or whether he is a person who lives off the backs of others in the black economy. We are far too ambivalent about this area. We all accept the lads pulling a stroke, dragging in the few shillings on social welfare. The harm in that is that those who are entitled to the benefits are denied the full amount because the generosity and the willingness of the taxpayer to share income with the poor is being abused by people who defraud the system.

I commend the Minister and the officers of his Department on their actions in the past 12 months. There has been a lot of hollow rhetoric about fraud and abuse of the social welfare system. There have been important improvements here. While it is undoubtedly true that there can be improvements, it is equally true that fraud, abuse and theft from the social welfare system has reached such proportions that they must be addressed. Later I will deal with some issues where the Department could behave more sensibly towards individuals.

Deputy McCartan referred to the harshness of the Department in the case of cohabiting adults. I cannot understand his logic that suggests that a couple cohabiting out of wedlock should be treated more favourably than the married tax paying couple. I am sure taxpayers cannot understand that logic. Perhaps this was a flight of oratorical excess from Deputy McCartan but that certainly was the import of what he said. It is extraordinary to suggest that a cohabiting couple should be subject to less rigorous scrutiny than a married couple paying tax. I am certain that the million or so social welfare dependants and their families and the tax paying public cannot understand the logic of that.

Mr. Pattison

Will the Deputy extend the logic of that argument? Will he then argue that if that man dies the woman would be entitled to a widow's pension?

Mr. Roche

That question should perhaps be better addressed to Deputy McCartan.

Mr. Pattison

You have made the case that they should not be treated differently.

An Leas-Cheann Comhairle

The question should not be addressed at all. Deputy Pattison will make his contribution shortly and he can present these questions then.

Mr. Roche

Perhaps the Deputy will address it to the Minister at that stage. Another welcome administrative change is the decision that the ludicrous contribution from the local authorities to the cost of unemployment assistance is to be removed. This contribution has existed for 50 years. It amounts to something of the order of £500,000 a year and it probably costs more to do the book-keeping exercise for the transfer of these funds than the transfer actually brings in. This change is welcome. At this stage we need to tease out all the areas of legislation and administration to look for anomalies such as this. I congratulate both Ministers on removing other circulatory transfers. The more of this we have the better for everybody.

Moving to a more substantive issue, I will refer briefly to the pre-retirement scheme introduced in the Bill. This is a very worthwhile proposal which I am sure is agreed by all Deputies in the House. Elderly long-term unemployed age 60 plus find it undignified to have to continue to follow the unemployment assistance procedure. This provision introduces a degree of dignity for elderly unemployed. It provides a flexible approach and recognises the reality that many of the elderly on long-term unemployment assistance are semi-retired. This provision is long overdue and should be welcomed. There is an additional benefit to the people concerned and that is that they will no longer be forced to undertake the sort of travelling Deputy McCartan was speaking about. That is something to which I will refer later. It means that a very real benefit will accrue to these people because they will not have to travel to sign on, collect dole etc.

Another substantive proposal in this Bill is the introduction of pro rata pensions and the ending by the Minister of the social welfare anomaly which has been criticised so many times in every Deputy's clinic and on several occasions in the reports of the Ombudsman. I am sure every Deputy has cases of people coming and pointing out that because they were promoted they slipped out of social insurance cover at some stage between 1953 and 1974. This is a very real injustice. Only last week I was speaking to a pensioner affected by this anomaly. The point he was making to me was that it was not the economic loss that affected him most deeply but the real sense of injustice he felt because of the anomaly. The Minister is to be congratulated. He is fulfilling yet another pre-election promise and this in spite of the hard times we have.

There are other improvements, in particular the improvement in the family income supplement. This is welcome. It brings the new rates into line with the general social welfare increases. The FIS scheme requires to be reviewed. Undoubtedly it contains small chinks that could be corrected and evened out.

One area which is being dealt with by a number of Deputies and which does not arise in the context of the Bill is administrative reform in social welfare. In 1980, if my memory serves me correctly, the present Minister was in office in Social Welfare and took an important step in his Department by introducing anti-anonymity measures by requiring officials to adopt the simple practice of wearing name badges. The Department have slipped back in that regard. Deputy Boland while Minister for the Public Service tried to introduce similar requirements. Sad to say, now when you ring the Department again you are told you were talking to "disability 9,""disability benefits 7" or whatever. Improvement in creating a human face for the Department should be pursued. It is important that officials who deal with the social welfare system, who we all accept have a trying, sometimes difficult and even dangerous job to do, recognise they are not simply dealing with numbers or files. Clients, the customers of the social welfare system, should themselves feel they are not dealing with cyphers, anonymous people from the back of the Department. An effort should be made in the Department to create a greater sense of client-public servant relationship.

Another area which urgently requires redress and was dealt with by Deputy Wallace to some extent today, is the degree of centralisation in the Department of Social Welfare. It is ludicrous that virtually everything in social welfare still emanates from Dublin. I know the Minister is making efforts in this regard; nonetheless I am impatient for a greater degree of decentralisation. I would like to see every social welfare office make decisions on 80 to 90 per cent of the cases coming in to them from their catchment area. That would be a welcome administrative change because it would obviate a great deal of the clientelism associated with social welfare.

More important, the social welfare system would be administered more economically if the decision officers were closer to those people about whom they were making a decision. Fewer errors would occur in the system; therefore the cost of correcting errors would be lower and less of the administrators' time would be taken up with answering public representatives and correcting errors. The most important improvement of all that would flow from a higher degree of decentralisation in the social welfare system would be that the people who are dealing with the Department would feel they could contact and have direct access to the people who make the decisions concerning their lives in the first place.

Another area under this general administrative heading is the delivery of services. Efforts have been made to make improvements at the physical point of delivery of social welfare; nonetheless a great deal still requires to be done here. For example, in Bray the social welfare exchange is housed in a new building but people still have to queue in the open. That is undignified, uncomfortable and unnecessary. It should not be beyond human capacity to establish some queueing system that would treat people with more dignity and afford them a greater degree of comfort than is the case at the moment. The Minister initiated visits some time back to exchanges. The Taoiseach when he was Minister was probably the person who first initiated this practice. We should look at how we deliver these systems and even at basic things like the physical structures being used. Many exchanges are still housed in buildings which are totally unsuitable. I realise there will be a cost implication in making improvements here. At the same time for people who suffer poverty and loss of employment and are dependent on the social welfare system, the minimum we should try to ensure is that they are treated with dignity in all their dealings.

While the Department have made considerable improvements on the information side, other aspects of their communications with their customers leave a great deal to be desired. Recently I communicated with the Minister's office on the standard form which is now sent out to people who are being denied, for example, unemployment assistance. Form UB 27A, if my memory serves me rightly, came to my attention recently. It is a particularly undesirable form, a mimeographed sheet of paper not particularly well printed and in the empty spaces where the judgment is delivered there are various rubber stamps. Probably the only thing on which I agree with Deputy MacCartan is that it is very difficult to understand what the form is saying. More to the point, you would have to have access to the full social welfare code and a variety of legislation before you could interpret what the officials are trying to communicate to the unfortunate recipients of this form. There must be a better way of doing it. In a world where modern technology provides us with things like word processors, surely it should be possible for the Department of Social Welfare to communicate on a more individualistic, more specific basis, in far simpler language, with their clients than is the case.

Finally under this heading, people still have to travel long distances to sign on. People unemployed in Greystones, for example, travel to Bray. People from Kilcoole travel to Greystones. People from Newcastle travel to either Kilcoole or Newtownmountkennedy. That is extraordinary because you have to spend a considerable portion of your allowance or benefit on travel for the purposes of meeting with the Department's requirements. This strikes me as being a cast back to the poor law mentality and really has not much place in 20th century thinking. I do not understand why it is necessary, for example, for an unemployed person in Newcastle to walk three miles to Newtownmountkennedy to sign on and then walk three miles back along an open road, sometimes in very inclement weather. I do not understand why we cannot have a system whereby people can sign on in their own area. I would ask the Minister to look at this.

On the whole, this legislation is progressive. I am at a loss to understand why it is necessary for Members of this House to continuously say that everything that is done by the Government is rubbish. Perhaps if I were here a few years longer I would be as guilty of that as others but a little forebearance and more self discipline is called for. There are progressive measures being introduced in this legislation, and rather than dismiss them we should take it upon ourselves to see where we can identify further improvements and better communicate the improvements that will be agreed when the House passes this legislation.

Mr. Pattison

I could not agree more with the last sentiment expressed by Deputy Roche in regard to the amount of rubbish spoken about social welfare legislation. It is a pity the Deputy was not a member of the last Dáil but the record shows that when I was Minister for Social Welfare there was a lot of rubbish spoken and much filibustering on every piece of social legislation that was brought into the House, particularly in regard to the legislation setting up the Combat Poverty Agency when the Deputy's colleagues in Fianna Fáil spoke nothing but rubbish and held up that Bill for well over 12 months in this House for no apparent reason. If the Deputy, having read the report, feels that what I am saying is wrong, he is welcome to come back and tell me.

I do not intend to speak any rubbish on this measure. It is a pity that such major social welfare legislation is being put into what has become a routine Bill, the annual measure to give legislative effect to the budget improvements. It would have been preferable to have a separate Bill dealing with the extension of social welfare to the self-employed. I know that eventually it will probably be consolidated into the main Act. Nevertheless people wishing, in a few years time, to refer to the legislation extending social welfare to the self-employed will be puzzled because there is no Bill with such a title. Because this is a whole new area it justifies a Bill of its own, independent of what I have described as the routine annual social welfare Bill.

I could say a lot about the inadequacies of certain increases under the budget. That has been mentioned. I want to use my time to refer specifically to a number of areas. Before I do that I want to highlight once again the creeping restriction on social welfare entitlements. A number of ministerial orders were made and a number of measures taken in the past 12 months, all of which have the effect of taking from people what they were previously entitled to. I refer particularly to the new requirements of increased contributions and credits now for many benefits. The impression given is that these measures were necessary to combat fraud.

All of these measures have only one purpose and that is to take from people what they are rightly entitled to and prevent people claiming what they were rightly entitled to. Someone who is unfortunate enough to get a serious illness is now told that benefit cannot continue beyond 52 weeks unless they have the required number of contributions, that is, five years paid contributions. It is now virtually impossible for a young worker who falls into that category to have that requirement and this results in severe hardship on the person and on his family. This is a form of legalised fraud whereby the State changes the rules to prevent people who are otherwise entitled to benefit from getting it. It is particularly despicable when it is aimed at people with prolonged serious illneses.

I hope that some amendment will be made to those provisions, particularly with regard to younger workers, because now more than ever, the chances of young workers getting five years paid contributions under the social welfare system before the age of 30 are becoming more and more remote. Therefore their insurance cover is a kind of fraud, because the whole idea of insurance is to ensure against certain calamities, one of them being a breakdown in health. It is amazing that temporary breakdowns or minor health ailments are covered because a person is covered for 52 weeks, but the more serious ailments, the ones that take over 52 weeks to cure or which are incurable are the ones that are directly hit and the benefit is withdrawn. I feel very strongly about this because there are people confined to wheelchairs or who are in very bad situations and who will find themselves cut off from benefit in a few months time simply because they were not fortunate enough to have five years fully paid up stamps before the tragedy hit them. I appeal for some recognition of this fact so that insured workers, even under a certain age, say, the age of 30, could still avail of the continuous benefit for a period in excess of the 52 weeks because the chances of having more than five years paid contributions over the age of 30 are greater than for people under 30. There are very strict rules and regulations regarding the qualification for these benefits, in particular the degree of incapacity has to be clearly established. It is very critically examined and there is no question of somebody getting benefit by pretending he is sick, ill or injured.

Another area in which this Government have acted despicably is the area of cutbacks on the entitlements of widows and deserted wives. I do not know why these areas have been picked on by the Government. I refer to the withdrawal of the overlapping benefits arrangement. Here again there is a category of people — widows — who are in a very vulnerable position — I cannot think of many categories who are in a more vulnerable position. This Government have undertaken a very dastardly act in denying these people the very modest arrangement that obtained down the years whereby if they had their own insurance record they could claim partial disability or partial unemployment benefit and at the same time their entitlement to the widow's contributory pension would not be affected.

Many widows have struggled to go out to work in order to gain this entitlement. Because they are not "lucky" enough to have been on disability benefit before 31 December 1987 they will get approximately £20 a week less than widows who were in receipt of the benefit before that date. How can you explain to a woman who has become a widow since 1 January this year that, even though she has worked all her life, paid her social welfare contributions, contributed handsomely to the State and is now in a state of health where she has to claim disability benefit — her husband would have worked all his life and paid into the social welfare fund, taxes and so on — just because her husband died since 1 January this year she will be approximately £20 a week worse off? It could be unconstitutional to deny people this benefit, they having contributed on the basis that they were going to get it. If the Government had decided that this would be the position for all new entrants to the social welfare system from 1 January it would be bad enough but to introduce the measure in this retrospective manner will bring nothing but hardship and suffering on this section of the community who are already carrying a severe burden and sorrow, having lost their husbands through death. It is a despicable act. These widows have earned that money. The partial receipt of benefit was a reasonable and fair arrangement. It recognised these people's contributions to the system. It was very mean of the Government to cut back in this area.

Many wives whose husbands are a few years older than they and in receipt of the old age pension get the benefits of free units of electricity and free television licence and avail of free travel with their husbands. When their husbands die, if they have not reached 66 years of age, those benefits are withdrawn. I recognise that is a problem and I know that area has been looked at to try to maintain these benefits. It is cruel to withdraw the benefits when these people have been receiving them for some years but I admit it is not easy to devise a system to overcome that problem. To introduce this other mean attack on widows is beyond my comprehension and it cannot be defended on the basis of fair play, of saying they have an advantage over other widows. They have contributed to that scheme and they are entitled to some recognition of those contributions.

Whatever good this Government might do — I still have to see signs of the good they are doing in the area of social welfare — the measures which hit at minority groups, groups who are not in a strong position, such as the seriously ill, the long-term ill, widows and deserted wives, measures which make their position even more disadvantaged in relation to social welfare entitlements have to be highlighted. This area has not received the kind of attention in this House that it should have. I hope that more Members, particularly on the Government benches, will put pressure on the Government to withdraw these very mean and despicable measures, which are not contained in this Bill. This Bill is a public relations exercise. These measures have been slipped in very quietly in other ways and they are affecting the unfortunate widows and the long-term sick people, people who are not in a position to shout loudly about them.

I want to refer to the whole area of unemployment benefit and unemployment assistance. In this area there is a crazy practice where recipients of these benefits are sent around like fools to various employers looking for letters to the effect that the employer concerned has no work available for them. The position has got so bad in the last few months that some factories I know of have put notices on their doors that they are not issuing letters to these people. I know one factory where the management claimed they would have to have a full-time clerk typist typing letters to the local exchange down the road telling them that there is no work available. I cannot think of a more crazy system. The Government are providing all kinds of inducements to do away with jobs. I am thinking of the redundancy packages particularly as they pertain to rural areas where a manual worker's main hope of getting a job rested with his local authority, working on roadworks, drainage, building of local authority dwellings and so on. That was the main source of manual workers' employment in rural areas. The Government have effectively done away with all of those jobs.

Indeed, I might add that people in rural areas are being cut off from benefit and the dole. The common practice appears to be that they receive a letter out of the blue informing them that as they are not seeking employment their assistance will cease this week. I have knowledge of a man with nine or ten young children who around 9 or 10 December last received a letter without any warning informing him that his unemployment assistance was to be discontinued because he was not seeking employment, and that in a rural area where everybody knows there is absolutely no employment to be found. As will be appreciated, that family had a miserable Christmas. If that type of practice is to be carried on, then the Department should at least wait until after Christmas. There is this kind of harassment of people in this respect. I have heard of another case of a woman, a health board worker, who availed of the Government's redundancy package and when she claimed unemployment benefit she found she was disqualified on the basis that she was not seeking work or had voluntarily left her employment. She won her case on appeal.

I cannot for the life of me understand the logic of this type of practice, of people having to appear before appeals officers producing anything up to 20 letters from all kinds of people, shopkeepers, farmers, whoever; they have to tramp the roads appealing for these letters. I should be very glad if the Minister would offer some explanation of this practice. After all, we have a very efficient, widespread Manpower service which monitors closely any job opportunities or any prospect of employment in given areas. That being the State way of doing things, surely that should be sufficient in this day and age to satisfy that State requirement?

I know that employers are now refusing to issue such letters because they cannot see the sense in doing so. I do not know where all of these letters are filed in the Department. There is one particular source of employment in my constituency which must be issuing, on average, 100 letters a week on this basis. One letter from one factory should be sufficient, saying: "We have no jobs, there is no prospect whatever of employment here in the next 12 months." Why should every Tom, Dick and Harry who sign at the local labour exchange have to beat a path to that factory seeking a letter to the effect that there is no work available there?

I see the need for the pre-retirement scheme and the need to extend its provisions to an age below that at present mentioned. There is now, unfortunately, a new form of unemployment thanks to this Government's policy of creating so much unemployment in rural areas through the withdrawal of funding from local authorities. Many people who lost their jobs in this area at an age much lower than 60 will find it extremely difficult ever to get employment again. That is a most unfortunate plight for such people. This scheme should be kept under review. Possibly the age should be lowered next year because unemployment benefit and assistance were never regarded as permanent payments by the beneficiaries or applicants. However, the way things are going many people may find themselves permanently dependent on them. This is tied in with the argument Deputy Roche advanced earlier about people having to travel long distances to employment exchanges to sign on. Indeed, some constituents of mine in County Carlow must pass one local exchange in their village to travel to Deputy Roche's constituency in Baltinglass to sign there. It is very difficult to explain to such people why they must cross county boundaries into the town of Baltinglass to sign on there.

I refer to another point raised by Deputy Roche, that of the ambivalence of people with regard to social welfare fraud. Even within the terms of this Bill there is a certain ambivalence to be detected about social welfare fraud. The provisions of section 9 allow for an amnesty to defaulting employers whereas there is none allowed in the case of employees. I find it difficult to understand why that should be so. I would be very much in favour of mercy and forgiveness in cases of real hardship where it is obvious that because of a set of unfortunate circumstances PRSI contributions were not paid up. However, we all know of cases of blatant disregard for the law, for the rights of employees, blatant misuse of workers' contributions. The fact that these defaulting employers should now be given an amnesty appals me, people who blatantly and fraudulently deprived this State of its rightful contributions from employees. I contend there should be no mercy shown such people but, that being said, I am very much in favour of mercy in genuine hardship cases. I would welcome an amnesty in such cases but there should be no semblance of an amnesty for the former category.

There are a few other matters I would like to have referred to but I want to refer briefly to one other important point. There is a tendency by Deputies in this House to attack social welfare officers. These people have a difficult job to do and it is unfair to make general attacks on them. Taking all the factors into account, by and large they do a very difficult job very well and very courteously. As in every group there will always be a few people who may not have the most suitable personality for these very difficult jobs but by and large they do their job well. There is a need, as Deputy McCartan and Deputy Roche have said, for further information to be given to recipients. Many claimants for benefits do not seem to understand the role of the social welfare officer. They regard him as an enemy when in actual fact he should be regarded as a friend. This happens because claimants are not fully informed about the role of social welfare officers and also because they are not fully informed as to why certain decisions are made. Sending forms to claimants and quoting sections and subsections of Acts is of no help to them. They should be given more information.

Mr. Flood

In the context of this Social Welfare Bill, it is worth noting that we spend over £7 million per day on social welfare payments and that in so doing we cater for 1.3 million people. I do not think any of us can quarrel with the need to pay social welfare and I believe all of us would wish to see a continued improvement in the level of payments to people on social welfare of one kind or another.

However, in reviewing the payments I have referred to, this Government or any other Government would have to have regard to the economic and financial circumstances of the country. Notwithstanding this fact, the Minister and the Government are to be congratulated for continuing to provide, in some cases, major increases for those who are on the lowest level of social welfare payments. An example of this, is the 11 per cent increase in the personal rate of unemployment assistance and supplementary welfare allowance and the 6 per cent increase for dependant children. Those two increases are extremely welcome and are very necessary during the expensive times in which we live. In money terms, the increases I have referred to will mean an extra £4.20 per week for a single person and £6.70 per week for a family with three children who are on long-term unemployment assistance. Taken together, the total package of social welfare increases will amount to £101 million in a full year, which is very substantial in anyone's language. I note that the Minister is making continued provision for the payment of equal treatment payments which will cost £20 million. All of us welcome that payment. The Minister has taken a number of decisions in this regard since coming into office and I am glad he is continuing with his commitment to the payments because they are necessary and, I am sure, all of us support them.

The extension of PRSI to the self employed is a major feature of the Bill. This has been discussed for a number of years and at last some real decision making is taking place. I welcome very much the Minister's decision at this time to extend social insurance to the self employed. It is a major step forward in the ongoing development of our social welfare system. I do not think it is widely known that the self employed have never been catered for in terms of social insurance and it is only right and proper that this scheme should be extended to cover them and that it should be available on the widest possible basis. That is the important point I wanted to make about it. What the Minister is doing in this regard is simply picking up from where he left off when he was Minister for Social Welfare in 1982. At that stage the Minister had developed to a fairly fine degree proposals for extending social insurance to the self employed. I have to make the point that after leaving office in 1982 no further specific progress was made on the matter until the Minister came back into office in 1987 and basically took up from where he left off. Decisions are now being taken in relation to PRSI and given effect to in this Bill.

The extension of PRSI to the farming community is very welcome. It is only right that they should contribute to this scheme. It is evident to many of us that a great number of widows of self employed people have been left without any guaranteed independent income and this, in many cases, has given rise to substantial hardship because of changed family circumstances when a husband died at an early age, often leaving a widow with young children and leaving also, perhaps, some financial commitments. Therefore, the extension of this scheme will be a major help to widows and will also ease the worry and strain on families who, unfortunately, find themselves bereaved by the death of the breadwinner at a crucial stage in the development of a family. Under the Minister's scheme widows of self employed people will have the same rights to a basic pension, without having to undergo a means test, as widows of employed persons currently have. That is a very caring and humane way to approach what can sometimes be a very sensitive and distressing problem.

Of course, this means that the self employed must for the first time make a direct contribution to the cost of social welfare pensions. It is only right that the Minister should seek a contribution from the self employed for pensions because we have to take account of what might be termed the "good risks" and the "poor risks". We have to spread the load across the widest possible number of people and take account of the fact that the self employed may, for a number of years, enjoy substantial incomes. It is only right that we as a nation should seek to compel them to make provision for their retirement pensions through the scheme the Minister has outlined.

In deciding to phase in the contributions over a period of three years, the Government and the Minister have been mindful of the need to allow time to the new contributors to adjust to making their contributions. The Bill stipulates that the rates of contributions, to which I have referred, will be phased in over a three-year period starting on a 3 per cent basis from 6 April 1988, with an increase to 4 per cent from 6 April 1989 and an increase to 5 per cent from 6 April 1990.

One point about the phasing-in aspect is that the legislation to give effect to this is contained in this Bill. Therefore, as I understand it, no additional legislation will be required next year or the year after. The Minister and the Government were wise to incorporate the phasing-in scheme in the proposals in this Bill over the next three years without any additional activity being required in this House. The Minister should be applauded for recognising the need to approach the matter in that fashion.

I particularly want to refer to the pre-retirement scheme. Here again an indication of the caring attitude of Deputy Woods in his role as Minister for Social Welfare is the bringing forward of the decision to introduce this scheme. Many elderly people who are close to their retirement years accept generally that they are in a semi-retired situation and are very unlikely to go back to full-time employment. Perhaps many do not wish to go back to full-time employment and for that reason payment of their benefits should be made as easy for them as possible. The need to sign on on a weekly basis is superfluous and we should be addressing ourselves to that issue, as the Minister is doing. He has decided that those who qualify now for participation in the scheme will be able to opt, if they so wish, to have their payments made by means of a pension order. This will enable them to cash their weekly pension orders at their local post office, without the necessity of having to sign on weekly. When people have reached those pre-retirement years that is the least to which they would be entitled. The Minister is to be congratulated for bringing in that proposal. It is new and will certainly be of benefit to those to whom I have referred.

Another small point is the abolition of the need for local authorities to pay contributions toward the cost of unemployment assistance. That requirement on local authorities amounted to £500,000 per annum and the Minister and Government have decided to fund that directly from the Exchequer. I am sure a great deal of administrative cost was involved and perhaps much supervision, but it is not before its time that this was changed. It is right that it should be taken out of the area of responsibility of the local authorities.

During the course of yesterday's debate some reference was made, I think by Deputy De Rossa, about the implications for local authority tenants who receive social welfare increases. He was critical of the fact that these tenants sometimes found their social welfare increases practically nullified by immediate increases in rent. I am not sure if Deputy De Rossa is aware that the rent scheme is organised by the local authority and the changes in rent are the responsibility of individual local authorities. They do not increase rents under a directive from central Government. Each local authority decide the rate to be charged on their property and it is only right, as a member of a local authority, that I should point this out. However, local authorities will have to take more account of the manner in which they fix rents for tenants and they will have to be more compassionate in terms of increasing rents based on increases in social welfare payments, about taking away the financial benefit accruing to tenants once a Bill such as this is enacted and the increased rates come into force in July.

There has been some recent discussion in relation to the income from social insurance for the self-employed and some suggestion that it would cost the State a great deal of money. Having critically examined the scheme, I do not believe that will be the case. When one takes into account the existing arrangements, the additional cost of the scheme over and above the arrangements to which I have referred will go from £6 million in year five to £21 million in year ten and £89 million in year 50. By the end of year ten, the scheme will have accumulated a surplus of something in the order of £360 million. Some of the recent erroneous statements were based on the interpretation of the expected yield in 1988 and that was just extended year by year. One cannot take it on that basis.

I note the Minister has rejected suggestions that the self-employed should be allowed to opt out of the scheme and I agree with that. The self-employed must participate in this scheme. It is an attempt to bring equity into the social insurance system by bringing in the self-employed to contribute to the financing of their own pensions for the first time. We all must contribute to the scheme, those who would be considered good risks as well of those who would be considered doubtful risks. We must all participate to ensure the success and stability of the scheme. The information available at present is that 70 per cent of former self-employed people qualify for social assistance pensions for which they have not contributed a single penny. We should not allow that to continue and the Minister's decision is to be welcomed. Ultimately it will benefit all of us.

One of the areas of social welfare in which I am particularly interested is changes in administration. There have been consistent complaints about the manner in which the whole area of social welfare is administered. The Minister has taken this matter very seriously He has shown himself capable of being extremely innovative in terms of bringing in new technology to deal with social welfare applications and payments. last year, if my memory serves me correctly, the Minister obtained a sum in excess of £2 million for the commencement of substantial computerisation of his Department. The new technology available in terms of transmission of information from computerisation systems can only streamline the operation of the Department of Social Welfare. The payments affect 1.3 million people so the amount of paperwork under the old system must be absolutely colossal. The new technology should help us to cope more effeciently with the development of a social welfare system that is mindful of the people's needs and that is caring and efficient in terms of meeting the demands of those who need help at a time when they are finding things extremely difficult.

The programme initiated by the Minister to develop computerisation in his Department will play a very significant role in helping the Department to meet their obligation to those who have occasion to do business with them in terms of social welfare applications and payments. I know the Minister is extremely committed to that programme, in which I have a very great interest. I shall be watching developments in the years ahead. The Minister has set himself a three or four year target to achieve rationalisation and computerisation of the service in the local areas. For that reason, I support his efforts and those of his officials in this regard.

The Minister is also very committed to the one stop shops. This has a bearing on what I said in relation to computerisation, etc., and the Minister has already begun his programme in regard to the establishment of one stop shops as he is seeking to meet the growing demand among social welfare claimants to be paid in their own localities. It is the Minister's intention that one stop shops will speed the delivery of service to applicants and do away with the unnecesary recourse to supplementary welfare which is a stopgap payment while the system is sorted out in relation to an individual applicant.

It is interesting to note that in my own constituency in Tallaght, social welfare cheques which were forwarded through the post failed to arrive because, unfortunately, the postman was held up. About 600 families were severely inconvenienced that week as they had been expecting payments on Friday. At the last minute, the Minister had to make arrangements in the local health centres to cope with the demand from those who had not received payments. If we could streamline the service, as suggested by the Minister, incidents such as the one to which I referred would not arise. The establishment of the one stop shops would help to prevent that type of problem arising.

Computerisation could help us to allow social welfare beneficiaries to go to the shop on the high street if it was suitably geared to cope with a link-in to the Department of Social Welfare so that social welfare recipients could cash their cheques there. They should also be able to make claims in that regard. The lottery promoters have said that computers will be installed in various locations throughout the country and the social welfare system could also be geared in that way, although perhaps not as widespread. The employment exchange or the health centre need not be the only centres which deal with social welfare benefits. This would put a more humane face on social welfare and there would be a more caring image in regard to payments. If people are entitled to social welfare we should ensure that they get such payments in the most efficient and caring way possible. The old attitude was that life should be made difficult for social welfare recipients although I do not think that is the case at present.

Taking the Social Welfare Bill as a whole, the Minister and the Government have succeeded in providing major increases for those on the lowest social welfare payments, which is obviously very welcome. Fianna Fáil Governments have always stated their commitment to maintaining the real value of social welfare payments and they have succeeded in that regard. The Government have always stressed the need to introduce greater equity in financing the social welfare system and have extended the social insurance scheme to the self-employed, including farmers.

One cannot talk about social welfare and ignore the complaints regarding fraud and abuse of the system. The Minister has addressed himself to the problem, not only in the area of social welfare beneficiaries but also of unscrupulous employers who employ people without putting them on the books. That practice must stop. The employee is not necessarily the beneficiary of such a scheme, the unscrupulous employer is the main beneficiary. These people must be rooted out and told that such a practice is not acceptable. One must also ask if an employee in such a situation is covered for accident and injury suffered in the workplace. There must be very grave doubt as to whether the employer's legitimate liability insurance would cover such an accident. I very much doubt it. There are major implications for the person who allows himself or herself to be employed in that manner. The Minister must be supported in all his efforts to try to deal with that abuse of the system.

I congratulate the Minister and his officials for preparing this very substantial Bill, for keeping faith with the lowest beneficiaries in the social welfare system and for ensuring that they get an 11 per cent increase. The Minister has also improved the benefits under the FIS scheme. It was right to meet our responsibilities in this regard because some people in employment find it extremely difficult to meet their commitments with mortgage repayments, ESB bills, etc. I compliment the Minister and the Government for what they have done in the Bill. They have honoured their commitments and will continue to review social welfare incomes. As each budget over the next three years comes before the House, there will be a considerable, continuing improvement in the level of payments to social welfare beneficiaries so that their real income increases year by year.

Mr. Sheehan

I welcome the increases in the Bill for social welfare recipients. They are small increases but they are a step in the right direction. I am amazed at how active the social welfare officers have been in the past 12 months in their operations all over the country. There has been a countrywide blitz in regard to investigation from the Department of Social Welfare in relation to recipients of unemployment assistance, to old age pensioners and to the underprivileged sections of the community.

There is a need for tightening up the social welfare system in regard to fraud but the actions of the social welfare officers are not confined to apprehending the people perpetrating such frauds. Far from it; they are actually harassing old age pensioners and the less privileged in our society. I am aware of a number of cases where investigators from the Department of Social Welfare decided to terminate benefit under the free electricity and free telephone scheme given to old age pensioners simply because a person who was paid the prescribed relative allowance lived with them. There is nothing humane about that action. Did the Minister give a direction to social welfare officers to carry out such gestapo-type investigatons? Old age pensioners who call to my clinic have been in tears when explaining to me that their free electricity benefit had been terminated. Most of those people had great difficulty in having the benefit restored while others are still awaiting the result of their appeal.

In my view there is no need for such in-depth investigations. If the Department, or the Minister, insist on such a national blitz why is it that they do not devote their full attention to those who are defrauding the system and leave the underprivileged alone? I hope the Minister conveys my sentiments about those investigations to the officials of his Department and that he will ensure that they do not recur. The Minister should not tolerate that. Dozens of recipients of disability and long term benefits are having their payments terminated weekly. What type of investigation is being carried out into the means of people who because of their disability cannot do a day's work? It is important to remember that many of the investigating officials do not have a medical qualification and I wonder how they can declare a person fit for work. Those officials are terminating the benefits of such people without any regard for the medical certificates issued by general practitioners and surgeons. People are being deprived of any type of allowance for between six and nine months — in a number of cases for the remainder of their lives — although they can prove to the investigating officers that they are considered unfit for work by their local doctor.

It should be sufficient for a person to produce a certificate from a local doctor to the effect that he or she is unfit for work. It is wrong that they should be left without benefit until such time as a medical referee holds an oral hearing although, in many cases appeals are decided by senior officials in the Department. The Minister should instruct his officials to be more sympathetic to the weakest and most vulnerable section in our community. He should ensure that they get fair play and accept medical certificates from their local doctor as evidence of their inability to work. Such evidence should be sufficient proof to the Department to ensure a continuation of the payment of benefits to those people.

Mr. Kirk

And no medical referee?

Mr. Sheehan

I agree that there is a need for a medical referee but the medical referee should be instructed to take into consideration the contents of certificates issued by local doctors. Many people have been victimised as a result of the Department's policy in this regard.

Serious anomalies exist in the procedure for determining a person's entitlement to a widow's pension. When the children of a widow attain the age of 18 years the allowance paid in respect of them is terminated and the allowance paid to the widow is reduced by a further £6 per week. That is a heartless regulation but it is not surprising when one considers the many heartless decisions taken by the Government. How did that woman get means of £320 by virtue of the fact that her child had attained the age of 18? Who is the Minister codding? Is that the proper treatment to mete out to unfortunate people who suffer bereavement? I am amazed the Minister has allowed his officials to concoct this phoney figure of £320.

Last week a woman in my constituency presented such a case to me. I took up the matter with the Department and was told that the case was dealt with in accordance with the relevant regulation. The sooner that regulation is erased the better. Would the Minister like a reduction in salary of £320 if his child reached the age of 18? I hope he will not stand over the anomaly and that he will take immediate action to correct it.

Many non-contributory old age pensioners transfer their farms or businesses to members of their families on attaining the age of 66 because they are not able to carry on any longer and want to make provision for settling their affairs. Why do they not automatically qualify for their pension? If the son or daughter, nephew or niece to whom the farm is handed over has an off-farm occupation the rate of pension is drastically reduced. What has that to do with the applicant for the old age pension when he is compelled by health reasons to hand over his enterprise? If the relative is not resident on the farm the applicant will get only a very small percentage of the old age pension. Is that justice? Perhaps the relative could not exist on the small income provided by the farm. He may have had a job for some years because his father could not support him on the proceeds of the small holding. The investigating officer, the Department of Social Welfare and the Minister have no consideration for the plight of the applicant. The big stick is wielded and he or she is automatically deprived of the maximum rate of old age pension.

A further anomaly exists in regard to the social employment scheme. Applicants for that scheme are required to be in receipt of unemployment assistance for a considerable period before they are eligible. This means that people who are signing the live register but not drawing unemployment assistance do not qualify. Many people sign the live register who may not want to be a burden on the State by claiming unemployment assistance. Both categories are available for work but when the person who is not in receipt of unemployment assistance applies for a place on this special scheme he is told he cannot be considered. Surely this is completely wrong? We are actually inviting that person to be a burden on the State.

Unemployed people who are accepted for the scheme are compelled after 12 months to revert to unemployment assistance. Surely the Minister appreciates that this is very degrading for such people. It should be the Minister's aim to allow them to continue on the scheme as long as it lasts or to transfer them to a subsequent scheme where the promotors find it impossible to get a new set of workers. I can see no reason why the Minister would not correct that anomaly. People who are interested in continuing employment under the scheme should be given the opportunity to make their contribution instead of being a liability to the State.

I now turn to the question of farmers on holdings. I am speaking about the small farmers along the western seaboard whose interests I try to represent in this House. Will such a person receive an 11 per cent increase in his unemployment assistance? He is on long-term unemployment assistance to supplement his income from his farm holding and I would like the Minister to tell us whether he will be granted the 11 per cent increase which has been granted to the other recipients of long-term unemployment assistance. If they are not going to receive this increase I demand that the Minister grant it to them under this Bill. It would be a Christian thing for him to do to ensure that all those who are not able to eke out a living from their meagre holdings receive the same benefits as the man who can sleep in his bed for 24 hours if he wishes to do so. I insist that the increase of 11 per cent be given to small farmers who are in receipt of unemployment assistance.

When social welfare officers investigate claims from small farmers headage grants should be disregarded. Headage grants are provided by the EC to enable small farmers rear animals on uneconomic holdings. If they did not receive these grants they would not be in a position to rear these animals. The social welfare officer takes into account the income received from the sale of those animals, therefore how can the Minister comprehend the same social welfare officer also including the headage grants as income? It must be remembered he would not have been able to rear those cattle were it not for the headage grants he received. If there is any sincerity left in the Minister——

Mr. McGahon

There is not.

Mr. Sheehan

——he will take heed of what I am saying here today and correct that anomaly because without a shadow of doubt many of those small farmers along the western seaboard would not be able to survive if they did not qualify for unemployment assistance.

We are not fortunate enough to have major industries where our sons and daughters could obtain employment. Our position is different from that in the cities of Dublin, Cork and Galway. I am talking about the man living on isolated peninsulas from Mizen Head to Malin Head. These could be described as the people the Department of Social Welfare have forgotten. They are not being given a fair crack of the whip. They are underprivileged and are not being given their basic rights in regard to the assessment of income from their small holdings. I urge the Minister to take immediate steps to rectify that anomaly and to make sure that it will be corrected before this Bill passes into law.

The Minister tells us that for a family where there are three children, the increase in unemployment benefit will be £3.10 per week, giving them a new rate of £102.30 per week, that a retired couple receiving old age pension will receive an increase of £3 per week, giving them a new rate of £99.20 per week and that a widow with three children in receipt of a contributory pension will receive an increase of £2.80 per week, giving her a new rate of £93.30 per week. Social welfare recipients living in local authority houses have already had that increase absorbed as a result of the notices which have been sent out by the local authorities during the past week stating that their rents are going to be increased by between £3 and £5 per week. Where, then, is the benefit to accrue from so far as these so-called increases spelled out by the Minister are concerned? I think the Minister should have a word with his friend, the Minister for the Environment, so as to ensure that he does not gobble up any increases which have been given to those unfortunate people by the Department of Social Welfare. It is like tweedledum and tweedledee.

The Bill provides for an extension of social insurance to the self employed. The Minister stated that this was a historic development in the social welfare system but I have yet to be convinced that it is a historic development. It is a well known fact the the basis of social insurance is the provision of a basic level of protection as of right without a means test. I agree when the Minister says that the payment of compulsory social insurance will ensure that every person with an independent social income will contribute part of that income to financing the basic pension cover on a non-tested basis.

A person who will enter into insurance for the first time on 6 April and who will attain the age of 56 on that date will qualify for a contributory old age pension ten years later but the person who will attain the age of 56 on the following day or thereafter will not qualify for a contributory old age pension when he or she attains the age of 66. Surely, that is an anomaly which the Minister will have to correct. Not only is it totally unfair and unjust, it is probably also unconstitutional. The Constitution legally binds us to looking after each and every citizen without creating any distinctions between them. For that reason, I urge the Minister to make sure that the person who will attain the age of 56 on 7 April 1988 or thereafter will be exempt from paying PRSI contributions.

They will not gain one iota from their contributions.

There is no legal or moral obligation in the Bill to ensure that a person must give up his farm or business in order to get a pension at the age of 66 having made contributions for ten years.

An Leas-Cheann Comhairle

I suggest to Deputy Sheehan that he now use the word "finally".

Mr. Sheehan

A person can carry on with his farming or business and draw the contributory pension. Finally, will the Minister do something to correct the anomalies I have outlined? If this is a Christian, caring Government — and I have yet to be convinced they are — the Minister will take steps to rectify the anomalies and make sure that the person who will be 56 on 7 April 1988 will be exempt from paying contributions. It is sad that a man of 56 years of age on 6 April will get all the benefits whereas the man who is 56 on 7 April will be penalised in that he will have to undergo a means test to get a pension if he has one day short in the ten year contributions term when he reaches the age of 66.

Dr. D. Fitzpatrick

It is with some trepidation that I address the House after the eloquence of my colleague from Cork south-west. The people are obviously very well represented by Deputy Sheehan. I listened with mounting admiration to his discourse on the social welfare scheme and its anomalies and the hardships under which his people in Cork labour. I represent what could be called the urban equivalent to what the Deputy described.

I would join with Deputy Sheehan in many of the points he made but I must take issue with him on his first point accusing the Minister of sitting back and relaxing. The Minister cannot be accused of that. The record speaks for itself. In the middle of an economic gale not alone did the Minister manage to maintain social welfare services but he increased their financial value. We must acknowledge that but not by minimising the defects that occur from time to time and of which the Minister is well aware. I know the Minister tries very hard within his budget to look after the disadvantaged people.

One would need to have spent at least 15 years practising law to understand the ramifications of the Social Welfare Acts. We should approach the working of social welfare from a different angle. A financial floor should be placed under people and the amount of money they receive should not depend on contributions, age, where they live, whether it is urban or rural living, but on their need. We should work towards such a system because peoples needs differ at different times.

I appeal here on behalf of old age pensioners. These people should be entitled to a pension whatever their financial situation and whether they have made contributions over the years. A person who has survived to the age of 65 is entitled to every consideration the State can give. At that age one's resources, financial, physical and intellectual, are running down and one cannot keep up with younger people. This is a generalisation and I realise that one can cite the particular, but those who have reached pensionable age are worthy of special consideration. Incidentally, I can never understand why one must be 66 before one is entitled to free travel. Perhaps the Minister in his reply will elaborate a little on the difference between the red bus card and the yellow bus card. It was brought to my notice recently by some of my constituents.

Deputy Sheehan referred to non-contributory pensions and made quite an eloquent case. He insinuated that people were being belittled by having to make a contribution prior to receiving the pension and that non-contributory pensions would over the next few years be phased out. Non-contributory pensions were introduced many years ago to deal with people in need. The taxpayer this year is burdened to the tune of £300 million to finance non-contributory pensions. Many people getting the benefit of non-contributory pensions do not really need them. Deputy Sheehan cited the case of people having to sign over their farms or businesses to their children in order to avail of a full non-contributory pension. People who were in possession of large farms and substantial businesses signed over their businesses in order to dip into the taxpayers' pocket. We are not an extremely wealthy country and this was an abuse of the system.

I will now deal with pensions for self-employed people over 56 years. Over the years people have come in and out of the social welfare system and have not the benefit of a contributory pension. In our constituencies we have all met such people who had to work on because they had no means or businesses and were not eligible for a contributory pension. Many of them have made the point to me, rightly, that they have worked in and for the State and raised their families and when they came to 55 or 56 years of age they were not entitled to a pension although they had at different times in their working lives paid into a contributory pension scheme. I find that a person must have paid into the scheme for ten years. The Minister said in regard to self-employed persons over 56 that they must have paid for ten years into the scheme before they are entitled to a contributory pension. I ask him to look at that again. He makes the point that in year 11 the cost to fund the scheme would be £40 million. However, he has a way out if he brings in pro rata pensions, as he has said. I ask him to re-examine this because not alone are we speaking about finance but about the dignity of the individual. Many of the older generation feel that the State in which they have worked for years has let them down or been negligent of their needs. Therefore, I ask the Minister, Deputy Woods, when he goes back to the Department of Social Welfare to look at this again.

I am delighted to see the extension of social welfare to the self-employed over 56 years of age. This is a very laudable idea. I praise the Minister also for the introduction of a pre-retirement scheme for many people who for one reason or another have been unable to engage in full employment, to work a 40 hour week or more. We all know in this day and age the demands on people working in businesses, factories and on farms. The competitive edge puts many of them out of court. They are just not able to endure the stresses of modern demands. The financial bottom line is the be-all and end-all of our lives. The Department of Social Welfare are one of the few Departments who can ameliorate this situation.

I would like to deal in passing with the medical referees department. Some of the decisions emanating from there are, on grounds of common sense and logic, indefensible, not too often but occasionally. People who are obviously unemployable and unwell are passed as fit for work and those who are obviously fit and well are passed as unfit for work. I do not know what can be done about it, but maybe it can be examined again and tightened up. Persons whose certificates are terminated end up, as in many cases in the Dublin area, with no income. They have to have recourse to the local health board clinic — in Dublin the Eastern Health Board — where the community welfare officer will deal with the problem, but he is acting under fairly severe financial constraints. There is a gap between being disbarred from social welfare allowances, one's appeal being heard and if the appeal is successful one being put back on social welfare. I realise arrears are made up, but the arrears sometimes do not compensate for the weeks of discomfort and misery.

While on the subject of health boards working in tandem with the Department of Social Welfare, let me say that this area could be tightened up considerably to allow again for greater ease and communication between the two. In the area I represent we are extremely lucky to have excellent staff in the health board and an excellent social welfare office at Phibsboro Tower. Here I would like to praise the staff with whom I deal on almost a daily basis. I have found them nothing if not courteous and considerate to both me and my constituents.

All praise to the Minister for extending the dental benefit scheme last year to the spouses of insured persons. Note the arcane language: "spouses of insured persons". Strangely enough, it is not used when talking about deserted husbands. Deserted wives receive benefit, deserted husbands do not. Maybe if we dealt with "deserted spouses" we could come up with some scheme. Husbands become deserted, are left with families on their hands, children have to be reared, and it can be extremely difficult for a deserted husband to raise a family and hold down a job. This is not to denigrate for one moment the plight of deserted wives but to ask for even-handed treatment for both sexes.

As I said, the dental benefit scheme was extended to spouses of workers in benefit. Unfortunately, the Irish Dental Association saw fit to instruct their members not to operate the scheme. Being a practising dentist, I find that incomprehensible in a profession that purports to be one of the caring professions. As everybody knows, wives and mothers will put their children before themselves even to the extent of denying themselves dental treatment so that their children may have what they consider to be necessary for their future good. I ask the Irish Dental Association to consider whether they can put this scheme into effect with the least possible delay. Their basic argument — there are numerous arguments — is that it would reduce the scope for private practice in the dental area. I say to them it may increase their practices because it will bring a pool of patients into the dental scheme who were hitherto outside it. If we are anxious — the Irish Dental Association are, I know — about providing jobs for graduates, they should see that dental benefit is extended to everybody. They should be pressing for this rather than denying people who are deserving and in need of dental treatment.

Debate adjourned.