Dáil Éireann debate -
Wednesday, 7 Jul 1993

Vol. 433 No. 6

Adjournment Debate. - Self-Employed Unemployment Assistance.

Mr. Browne

(Carlow-Kilkenny): A Cheann Comhairle, I thank you for giving me this opportunity to raise such an important matter. On previous occasions I have raised the ill treatment of self-employed people who apply for unemployment assistance. I raised on the Adjournment the unfair treatment four people who were unemployed received from the Department. The Minister asked me to supply the names and said he would have a special look at the situation. There is an extra person now, a young man assessed as having £200 per week even though he has no work.

Their cases were appealed and I find it infuriating that an appeals officer, who must be living in cloud cuckoo land and guaranteed his own job for life, has decided that although the people are unemployed, they are earning the same money as they had when they were working. For example, one has been assessed at £155 per week, one at £135 per week, one at £200 per week, one at £85 per week and one at £154 per week. All these people were unemployed. The letters from the Department of Social Welfare stated that the appeals officer disallowed the appeal on the grounds that, having regard to the person's previous earnings, the assessment represented a reasonable expectation of his likely earnings over the following 12 months. Could anything be more absurd than a well-paid appeals officer talking about the expectation of earnings of a person who cannot get work? How do wives and children survive on mythical income? The final line states that the appeals officer's decision is final. This is incredible in 1993. I have spoken with the Minister, for whom I have a very high regard.

I have explained the unfair way in which the system works. The Minister agreed that the system is as I stated. It is time this unjust system was scrapped and that people who are unemployed should not be further insulted and humiliated. Recently I met a young man who was employed as a carpenter on a building site in 1991, earning £200 a week. Despite the fact that that man had been out of work since Christmas because of a record of his previous earnings his original application for social welfare benefit and subsequent appeal was turned down. He has now been told that he will have an income of £200 per week. This illustrates how unfair the system is. Is this system unconstitutional? It is amazing that people who are out of work can be told that they have the same income as they had when they were working. If this illogicality is accepted it would justify half a million people being unemployed. Why would people work if they could earn the same income while not working?

I call on the Minister to tackle this problem of gross injustice. Failure to address it does not reflect well on the Minister. Even though the Minister is aware that the present system is producing grossly unfair conclusions in respect of those involved, having regard to decisions made by his officials, the Minister has not taken any action to deal with this problem. Could anyone survive on the salary he or she earned two years ago or would he or she be relying on next month's salary——

Miss Harney

Yes.

Mr. Browne

(Carlow-Kilkenny):——having already spent last month's salary?

Self-employed people, such as painters, carpenters and bricklayers, who through no fault of their own cannot find work, are treated badly; and insult should not be added to financial injury in respect of those people by officials who are clearly out of touch with reality. It is time to deal fairly with a most iniquitous system to show that fair play exists for those who cannot get employment. It is time for this injustice to stop. The unemployed, their spouses and children deserve better. We must ensure they are treated fairly. I hope the Minister will rectify this injustice.

Minister for Social Welfare (Dr. Woods)

The Deputy referred to a number of cases. I have details of the cases to which he referred. The Deputy referred to an assessment of £135 per week. I will outline how the assessment process works. In that case the drawings, the net income after expenditure, in the year 31 March 1991 was £11,650. That income was declared by the painter and decorator in that case. The net declared income for the following year was £7,582 and the figure for the following nine months up to January 1993 was £8,926. Those figures are the declared net drawings in respect of a case to which the Deputy referred. The figures differ from what the Deputy understands the position to be.

Mr. Browne

(Carlow-Killenny): That money is spent.

An Ceann Comhairle

The Minister without interruption.

Dr. Woods

There does not appear to be any disagreement about the source of the income. One contract was lost and that contract may now be restored shortly and there appears to be agreement on that.

I mention the points to indicate that the investigators are not flippant people who make harsh decisions; they make decisions under statutory legislation. They make their assessment on last year's income and the expected income for the current year.

There is a statutory basis for the assessment of means of an applicant for unemployment assistance. The key element of this statutory provision is that in assessing means of an applicant account must be taken of "all income which he/she (or his/her spouse) may reasonably expect to receive during the succeeding year." In addition the Act goes on to specify that "the income of the person shall, in the absence of other means of ascertaining it, be taken to be the actual income received during the year immediately preceding the date of calculation."

Clearly the assessment has to be based on a starting point. In general this approach is to the advantage of people, but where the opportunities for selfemployment and income are likely to be less over the year ahead an adjustment will be made to reflect this.

I would like to stress that the starting point is as I have outlined. It is, however, only a starting point. It is a duty of deciding officers, having ascertained the previous year's income, to then consider the prospects of earning a similar income in the coming year. Officers must be satisfied that similar opportunities for selfemployment exist in the coming year and that the claimant would reasonably expect to receive the same income from his/her work.

Mr. Brown

(Carlow-Kilkenny): That is dreadful.

Dr. Woods

That is the statutory position. Where there is evidence that similar opportunities will not arise——

Mr. Brown

(Carlow-Kilkenny): That is dreadful.

Dr. Woods

The Deputy should take note of how the officers do their work. Where there is evidence that the income earning potential has been reduced in any way then the deciding officer can adjust the assessment to take account of this information. For the vast majority of cases this method of assessment works well.

Mr. Brown

(Carlow-Kilkenny): That is not the case.

Dr. Woods

There are many cases where this assessment is working well. Where subsequent to the original decision on the means assessment a client finds that his or her circumstances have changed significantly, then it is open to him or her to apply for a review of the means assessed.

The Deputy has recently drawn to my attention a number of cases where he feels that this approach has failed. As he knows, these cases were all reviewed in the light of his representations and the original decisions were confirmed. In some of the cases referred to there was a good history of earnings from selfemployment over a number of years and so it was possible to form a realistic forecast of potential earnings. There was no evidence to show that circumstances had so dramatically changed as to eliminate entirely the previous earning potential. I feel that it is important to also point out that the assessment arrived at takes account of the outgoings as well as the income and that the assessment is based on the net position.

I have indicated to Deputy Browne that I accept that it is vital that the method of assessment of means in the case of a self-employed person should have the flexibility to be able to respond to significant variations in the circumstances of such claimants. Deciding officers, in determining entitlements, try to ensure that any assessment is based on a realistic view of what is likely to happen in the coming year, as required by the legislation. This is what the current method of assessment seeks to achieve.

I have directed my Department to keep the method of assessment of means under review to ensure that it responds to the actual circumstances of claimants. In this context I have directed that the communication of such decisions to claimants be reviewed so that they fully understand how their entitlement was assessed.