Dáil Éireann debate -
Thursday, 17 Oct 1991

Vol. 411 No. 2

Written Answers. - Minimum Income Levels.

Emmet Stagg

Question:

13 Mr. Stagg asked the Minister for Social Welfare if he accepts the Commission on Social Welfare's assertion that in 1985 prices £50, approximately £65 in 1991 prices, is the minimum adequate income; and that those in receipt of social welfare or in low-income employment earning below this amount are, in effect, living below the minimum adequate income level; if he does not accept the Commission on Social Welfare's poverty line figure, if he will outline his estimate of the figure; and if he will make a statement on the matter.

Minister for Social Welfare (Dr. Woods)

As stated in the Programme for Economic and Social Progress, the Government are committed to a programme of reform of the social welfare system broadly within the framework outlined by the Commission on Social Welfare. There is a specific undertaking in the programme to move by 1993 to the priority level or rates recommended by the Commission.

Thereafter, social welfare rates will be further and progressively increased, in accordance with the recommendations of the Commission, as the resources of the economy permit.

The priority rate recommended by the Commission was £45 in 1985 terms. The 1991 equivalent of this is £54.00 and the 1993 rate, assuming annual inflation at 3 per cent per annum, would be around £58. The Government are committed to achieving the 1993 equivalent of the £45 priority rate by 1993.

The basic rate of long-term unemployment assistance is £55 at present, an increase of 46 per cent on the level which applied in 1987. Therefore, the priority rate has been achieved for the long-term unemployed this year. The basic rate of short-term unemployment assistance and supplementary welfare allowance was increased by 11.1 per cent from £45 to £50 in July as a step towards reaching the priority rate by 1993. The adult dependant allowance rates for unemployment payments were also increased to maintain the relationship recommended by the Commission and to give significant increases to families.

This year's budget increases led to additional expenditure of some £150 million in a full year. The additional special increases for those on the lowest payments and the increase in and streamlining of the child dependant payments led to substantial increases as follows: a couple with four children on short-term unemployment assistance received an increase of £11 (9.2 per cent) per week; a similar couple on long-term unemployment assistance received an increase of £9 — 7.1 per cent; a couple with two children on unemployment or disability benefit received an additional £5.20 — 5.1 per cent — and the payment to a widow on a contributory pension with three children was increased by £4 — 4 per cent.

In addition to the above increases the rate of child benefit payable in respect of the fourth child was increased by £7.10 per month in October equivalent to £85.20 on an annual basis.

TheProgramme for Economic and Social Progress also contains a commitment to devote resources to child income support on a scale which will implement the child support measures recommended by the Commission. The initiatives taken in the budget represent the first step in implementing that commitment. The programme also recognises the importance of the family income supplement in targeting resources towards families in low-paid employment. An additional £1 million this year and £2.5 million in a full year is being spent on this scheme to increase the income thresholds and the level of payments. A family on £140 per week with two children gained an extra £12 per week.

The general increases together with the specific improvements outlined above indicate that those on lower incomes, and particularly families, will benefit in a major way under theProgramme for Economic and Social Progress. The improvements which have been made over the last three years under the Programme for National Recovery demonstrate the benefit to social welfare recipients of the consensus approach to social and economic development on which the programme was based.