I join previous speakers in welcoming the new Ministers into the Chamber. I particularly congratulate the Minister I am about to address, Deputy Charlie McCreevy, and the Minister Joe Walsh, who are in the House, and I wish them both every success. Some day I hope to be over there myself.
PRSI Refund.
Again. The reason I raise this matter on the Adjournment — although I shall refer to an individual case — concerns the principle of the difficulty faced by an individual trying to get money due to him. The Minister is probably aware from details that have been supplied to him that the overpayment in question results from an employee who had an additional job and discovered that he was paying PRSI at a higher rate than he should have been. He and his employer sought a refund. As a result of the request to the Department of Social Welfare, the refund was sent to the employer on 7 November 1991. Unfortunately, on 12 November a receiver was appointed to the company in question. The cheque sent by the Department of Social Welfare had been lodged in the company's account. This is where the problem started.
I was contacted by the individual in early December. He was due £951.51. Since December, while the Department have been more than courteous to me in any contact I have made with them, the individual has not received his money. I recognise that there are difficulties for the Department in that they did issue the cheque; and I must say that I am extremely disappointed at the attitude taken by the receiver, who knew quite well that the money in no way belonged to the company in question and was the property of the individual, but refused to release the money.
We are now into February and the individual has not received his £951.51. I tabled a Parliamentary Question, No. 175, on 17 December 1991. Whilst the Minister of the day outlined the whole procedure, no progress has been made to date. I understand from contacts made with the Department today that a cheque may be released shortly. The reason why I continue to raise this matter on the Adjournment is to ask the Minister to ensure that in future, where refunds of overpayments are due to individuals, they should not be sent to the employer. This is money paid by the individual to the Department through the employer, just as PAYE tax is deducted and paid to the Revenue Commissioners through the employer. If a person overpaid PAYE tax the refund would be sent directly to the individual concerned. If that procedure was put in place here, the difficulty I am raising this afternoon would not have arisen. The Minister should take action to ensure that this individual gets his £951.51 and to ensure that the regulations are changed so that in cases where there are overpayments, the overpayment will be paid directly to the individual whose money it is. People should not have to go through the sort of hassle this individual went through over the last three to four months.
Receivers and liquidators have an obligation to the State and to the public to see to it that money which does not belong to the company is immediately released to the individual in question. If the regulations were changed this would not have arisen, but given the circumstances the receiver is wrong in holding on to money given to the company over which he now has control. This money does not belong to the company and he should not have held it up over the Christmas period. Why should a person who pays his taxes have to wait three to four months and why should the receiver be entitled to hold on to that money which did not belong to the company?
I am not blaming the Department for the difficulties experienced but I hope we will prevent this arising again by amending the regulations. I ask the Minister to kindly arrange for the issue of the cheque for £951.51 to the individual and urge him to take action in this area.
The Chair anticipates the indulgence of the House in associating himself with the words of congratulation to Deputy McCreevy.
I thank you, a Leas-Cheann Comhairle, for your congratulations, and also my good friend and colleague, Deputy Seán Barrett. I am sure that all the occasions on which I will rise to address the House will not be as pleasant as this evening's, because I am in a position to give good news to the Deputy. It is only fair to say that the individual to whom the Deputy referred came up against an unusual series of coincidences. It was like winning the lotto to find that one had burned the ticket the night before or the wife had thrown out the trousers to the binman.
As the Deputy is aware, the employer in this case paid PRSI at an incorrect rate in respect of the employee, the person concerned. Accordingly, both the employer and employee were entitled to a refund of the PRSI contributions paid in error. Regulations provide that, where an overpayment of PRSI contributions occur, the amount can be repaid to the employer provided he or she undertakes to repay the appropriate share to the employee. In this case a written undertaking was given by the employer and a refund of £3,098.46 was made to the company on 7 Novermber 1991. The sum of £951.51 represented the employee's share.
Unfortunately, before the amount could be paid to the employee a receiver was appointed to the company concerned. As a result the person concerned has not yet received the amount due to him. The receiver has not acceded to requests by my Department to release the sum concerned to the employee. In the normal course of events, the employee would have to await the outcome of the receivership in the knowledge that the receiver may not be in a position to pay him the amount due.
As promised in the reply of my predecessor to the Deputy's parliamentary question on 17 December 1991, officers of my Department immediately commenced investigations into the case to establish whether there was any possibility of reimbursing the employee directly. Even though the Department have discharged their legal responsibilities in this case, because of the circumstances and to avoid any more delays or risks for the employee, I have now arranged to make a payment directly to the employee concerned. This payment will issue shortly. My Department will now pursue the matter with the receiver directly.
In the light of this case I have arranged for revised procedures to be put in place to avoid recurrence of this type of incident. There are provisions in the regulations to allow for separate payments to be made but for ease of administration they have always been made directly to the employer. This is an unusual case. When the employee discovered that he was on the wrong rate, he had that clarified; all the procedures were gone through and my Department paid the money to the company. On the day the money was paid to the company, a receiver was appointed and consequently this situation arose. In the unusual circumstances prevailing, the employee will receive money from my Department very shortly.
This is an occurrence we would not envisage too often, but in the light of it we will review the procedures in the Department and we might make separate payments. Such a case might not arise again or the number of cases should be so small that there would not be much administrative difficulty.
The Dáil adjourned at 5.30 p.m. until 2.30 p.m. on Tuesday, 18 February 1992.