With the agreement of the House I would like to give one minute of my time to Deputy Gregory.
Adjournment Debate. - Social Welfare Alleviation Payments.
Is that satisfactory? Agreed.
I urge the Government to reconsider their decision to end the alleviation payments which were introduced in 1986 to compensate certain social welfare recipients for losses arising from the application of EC rules on equalisation. Thousands of social welfare recipients are now receiving letters from the Department of Social Welfare informing them that their payments will end in July. That is causing them much anxiety and concern.
These payments were introduced in 1986 to compensate in part people on social welfare who stood to lose considerable sums of money because of the manner in which the then Government chose to implement EC Directive 79/7 on equal treatment between men and women in matters of social security. The original payments were £20 or £10 depending on the circumstances of those involved but, over the years, the payments have been reduced to £12 and £6 respectively. The cost to the Department of Social Welfare is relatively small compared to their total budget — less than £2 million — but hardship for those involved will be considerable. The categories affected will be mainly those on old age, invalidity or disability pensions, the most vulnerable in society. These people are already living on or near the breadline and it is simply cruel to snatch the money from them in this way. There can be no justification for any change in the social welfare code which results in making those who are already poor even poorer. People have, understandably, got used to having the money and depriving them of these payments will create further hardship for them. No matter what gloss the Minister may try to put on it, this is the reality.
The cost to the Department had been declining steadily since 1987 as the numbers qualifying declined through death, people re-entering the workforce or other change in circumstances. Originally 29,000 people were receiving payments but this has now declined to fewer than 10,000 people. The scheme should have been allowed to wither through natural wastage instead of a rigid termination date being imposed. It could have been phased out by continuing the yearly clawback of £2 per week each July.
Members of Democratic Left welcome the decision to pay back-money to women who lost out because of the failure of the Government to implement social welfare equalisation on time in the mid-eighties. However, it is a pity that this is being funded, in part, by taking money from people who can ill afford the loss. These families are still paying a heavy price for the botched implementation of social welfare equalisation by the Fine Gael-Labour Government and, particularly, by their decision to equalise downwards rather than by increasing the level of social welfare payments at the time. The Department are claiming that they took their decision because "arising from recent decisions of the European Court of Justice, it has emerged that these alleviating payments are in conflict with the principle of equal treatment". My understanding is that this was not specifically said in the judgment but that it is the Department's interpretation of it. It may well be that if somebody took a case to the European Court challenging them, the payments might be found to be contrary to the principles of equal treatment. However, there is no suggestion of any such case being threatened or taken. I have never heard anyone on social welfare demanding that his or her position should be improved by cutting the income of others on social welfare.
Every case involving a potential increase for those on social welfare has been fought with great vigour by the Department through the High Court and the Supreme Court and through the European Court of Justice. However, where people stand to lose is where there is even the potential for a case and that is enough to make the Department cut and run.
The Department also said that the termination of the payments is being timed to coincide with the date of the implementation of this year's general social welfare increases, the implication being that people will really not lose that much. However, the loss will, in many cases, be considerably greater than the additional payment provided for in the Social Welfare Act. In addition, the general increases are simply in line with inflation and are designed to protect the purchasing power of social welfare payments. No matter how much the Minister may try, there is no way to describe the financial loss that thousands of citizens will have to endure.
Even at this stage I appeal to the Minister for Social Welfare to avoid further hardship for these families and allow the payments to continue.
I wish to thank Deputy Byrne for allowing me one minute of his time. As a result of this measure many poor families and pensioners whom I represent have been affected. I emphasise to the Minister that 10,000 families will be very severely hit and their poverty will be made even more acute by the loss of the alleviating payments. These people, many of them pensioners, are already in very poor circumstances and this will be a futher cruel blow. Indeed it is seen by many of them as an unnecessarily savage attack on their meagre incomes. Will the Minister say why he has to make such a huge cut in their incomes? Why not continue on a phased basis in a way which will not be such a heavy-handed blow to people——
The Deputy must bring his speech to a close.
——already living in poverty. Is the Minister deliberately availing of a handy opportunity to make the poor pay? How can he justify these cuts in a society where wealth is flaunted——
The time has come to call the Minister.
——particularly in the weekly property supplements of our newspapers where the rich are seen to grow richer while the poor are progressively made poorer. That is the effect of this measure.
There is a time limit on these debates and Members must adhere to it. I now call the Minister for Social Welfare to reply.
It is regrettable that Deputy Byrne should try to use this matter for his own political gain. The Deputy knows that there was no alternative to discontinuing these payments. He also knows that the £60 million being spent by the Government on arrears payments in respect of the period of delay in implementing the 1979 equal treatment directive would have counted for nothing if the alleviating payments had been continued because the courts have taken the view that these payments are in conflict with the principle of equal treatment.
He has been advised that various options were examined within my Department but the plain fact is that the Government had no option but to discontinue these payments. He is also aware that many of the families affected will receive very substantial arrears payments under the recently announced package providing for equality of treatment in respect of the period of delay in implementing the 1979 directive. For example, a married women with two children who was on unemployment benefit at that time will receive up to £1,400. If she was on disability benefit during the period of delay she will receive up to £1,300.
While Deputy Byrne may chose to ignore all this, I intend to put the facts on the record of this House. This whole matter is tied in with the EC Directive on equal treatment between men and women in the matter of social security. The Directive should have been implemented in December 1984 but the necessary measures were not brought into force by the then Government until May and November 1986.
Prior to November 1986, a man automatically qualified for an increase in respect of his wife even if she was in employment or was getting a social welfare payment in her own right. Under the new dependancy arrangements introduced in November 1986, the adult dependent increase is payable only where the spouse is not in receipt of a social welfare payment in his or her own right and where they do not have income in excess of £55 per week from employment or otherwise.
The alleviating payments were introduced in November 1986 by the then Government for a 12-month period only to avoid a sudden reduction in income for married men who lost dependency increases under the new dependency arrangements introduced at that time.
Two different transitional payments were introduced. Men who lost the adult dependant allowance because their wives were in receipt of a social welfare payment in their own right received a transitional payment of £20 in each case and, in addition, they could also apply for special equal treatment payments mainly in respect of credit-hire purchase agreements to buy essential household goods. Men whose wives had an income of £50 per week from employment, lost the adult dependant allowance and half of the child dependant allowance; they received a transitional payment of £10 per week and the half-rate increases for children which they lost were restored.
While these payments were introduced by the then Government for a 12-month period only, we decided to continue the payments but to phase them out gradually over a period of time. As a first step, the £20 and £10 payments were reduced by £2 and £1 respectively in July 1988 and the half-rate increases for children were frozen at their July 1987 rate. The payments have been further reduced on an annual basis coinciding with the budgetary increases and are now £12 and £6 respectively.
Arising from the delay in implementing the Equal Treatment Directive by the then Government, a number of court proceedings were initiated by married women. Having considered the most recent decision of the European Court, the Government decided earlier this year to provide for equality of treatment in respect of the period of delay at a cost of £60 million in the period 1992 to 1994.
Unfortunately, the courts have also found that the alleviating payments are themselves in conflict with the principle of equal treatment and for this reason, the Government had no option but to discontinue them. Contrary to what Deputy Byrne said, many cases have been taken in which transitional payments were sought by married women. In order to minimise the impact on people still in receipt of these payments, we decided to discontinue them with effect from the end of July coinciding with the date of implementation of this year's budget increases.
As Deputy Byrne is well aware, there is absolutely no alternative to terminating the alleviating payments because the courts have found that these payments are themselves in conflict with the principle of equal treatment. If the payments were not discontinued, the overall equal treatment package would be put at risk which means that despite spending £60 million to make good the failure by the then Government to implement the Directive on time, the matter would still not be resolved. In addition to this, the European Commission might well proceed with the threatened infringement proceedings against Ireland in the European Court.
The bottom line in all of this is that the Government are allocating £60 million for the equal treatment package over and above normal expenditure in the social welfare area. My Department have already identified over 110,000 potential beneficiaries. Personal claim forms have already been issued automatically to the women concerned and the first payments should be issued within the next few weeks.