Dáil Éireann debate -
Thursday, 22 Feb 1996

Vol. 462 No. 1

Written Answers. - Social Welfare Benefits.

Denis Foley

Question:

16 Mr. Foley asked the Minister for Social Welfare his views on whether it would be more appropriate to increase basic adult social welfare rates to bring them closer to the adequacy rates recommended a decade ago by the commission on social welfare in view of the fact that the general economic buoyancy levels within the economy are strong; and if he will make a statement on the matter. [4029/96]

Chris Flood

Question:

27 Mr. Flood asked the Minister for Social Welfare what plans, if any, he has for introducing flat rate increases in welfare payments rather than percentage increases in order that the poverty gap may be narrowed in view of the fact that his Department has presided over a widening in the poverty gap of £1,500 in take home pay of a long-term unemployed couple compared with a couple earning a £40,000 salary; and if he will make a statement on the matter. [4026/96]

Kathleen Lynch

Question:

56 Kathleen Lynch asked the Minister for Social Welfare the progress, if any, made towards achieving the Commission on Social Welfare target rates in 1986, 1990 and 1996 respectively; when he expects the ESRI to report on reviewing the target rates in light of the changes which have taken place since 1986; and if he will make a statement on the matter. [4019/96]

Ivor Callely

Question:

104 Mr. Callely asked the Minister for Social Welfare if he still holds the view that no further delays can be tolerated in achieving the minimum social welfare payment levels recommended by the Commission on Social Welfare in 1986; and if he will make a statement on the matter. [3969/96]

Ivor Callely

Question:

106 Mr. Callely asked the Minister for Social Welfare his views on the current levels of payments to old age contributory pensioners and other benefits; and if he will make a statement on the matter. [4053/96]

Ivor Callely

Question:

110 Mr. Callely asked the Minister for Social Welfare if he holds the view that setting social welfare increases on or about the level of inflation would only be satisfactory if the basic social welfare levels were themselves adequate; the measures, if any, he has taken to redress this issue; and if he will make a statement on the matter. [4058/96]

Minister for Social Welfare (Proinsias De Rossa)

I propose to take Questions Nos. 16, 27, 56, 104, 106 and 110 together.

In 1985, the Commission on Social Welfare estimated that the minimum adequate income required by a single adult was £50 per week. This was termed the "main rate" and is equivalent to £68.10 in 1996 terms.

At that time, the only social welfare schemes that provided rates of payment at or above the main rate were the old age contributory pension, retirement pension and some occupational injury schemes. All other social welfare payments provided between 64 per cent and 93 per cent of the main rate.

Significant progress has been made since 1985 in bringing rates of payment up to the minimum levels identified by the commission. By 1990, all social welfare payments had been increased in real terms and those not already above the main rate provided between 77 per cent and 95 per cent of the main rate.

The increases in this year's budget will bring all social welfare payments to a minimum of 92 per cent of the main rate, after compensating for inflation. The survivor's contributory pension and deserted wife's benefit will reach the main rate when the budget increases are implemented in June 1996. The bulk of the remaining payments will then be least 95 per cent of the main rate.

Economic performance has been very strong in recent years and the economic outlook remains very positive. It is important we take advantage of this opportunity to put in place adequate levels of income support for those who need it.

While it is clearly necessary to bring the remaining payment levels up to the main rate it is also appropriate to review from time to time what constitutes a minimum adequate level of income. To this end, I have initiated such a review and will put forward suggestions for new rates in the light of improvements in social welfare and other changes since the report of the commission was published, taking into account changes set out in the policy agreement. It will provide an objective basis for assessing the adequacy or otherwise of the current levels of old age contributory pension and other social welfare entitlements. The review will also discuss how the proposed rates could be indexed in future years.

The review will be completed by mid 1996 and, with other reviews of the social welfare systems, such as that of the expert working group on the integration of tax and social welfare, will form the basis for the formulation of proposals for improvements in the social welfare system in the years ahead.

Consideration will be given at that time to the suggestion that increases in payment levels should be implemented on a flat-rate as opposed to percentage basis in future budgets. Flat-rate increases provide one way of directing a relatively greater share of the available resources to those in receipt of the lowest rates of payment. However, over time, the exclusive use of flat-rate increases would diminish the differential paid to certain groups such as old age pensioners.

A percentage increase in social welfare payments adjusted to guarantee a minimum cash increase to all receipients avoids this difficulty while, at the same time, providing higher than average increases to those in receipt of the lowest rates of payment. This is the approach I took in this year's budget.

Applying flat-rate increases in social welfare payments across the board would not materially affect the fact that the increases in nett income experienced over a period by people on very high salary levels will be greater than the increases in nett income experienced over the same period by people on low incomes such as the long-term unemployed. This is simply because even modest percentage increases in salary, such as those provided for under theProgramme for Competitiveness and Work (PCW), amount to a larger cash sum when applied to very highly paid people. It will be noted in this context that fewer than 3 per cent of taxpayers are estimated to have earned income in excess of £40,000, which is the salary referred to by Deputy Flood.

Liam Fitzgerald

Question:

17 Mr. L. Fitzgerald asked the Minister for Social Welfare if he will have arrangements made to enable social welfare old-age pensioners to receive their pension for a reasonble number of weeks per year at a post office, other than the normal post office of payment without the pensioner being required to send the pension book to Sligo Pension Services Office at the beginning and at the end of the temporary absence(s) from the normal address. [17510/95]

Minister for Social Welfare (Proinsias De Rossa)

Old age pensions are normally paid by means of personalised payable order books which are encashed at local post offices. This payment system ensures uninterrupted payments to the majority of people whose claims are of a long-term nature. Pension order books are mandated for payment at the post office nominated by the pensioner.

If a pensioner changes address, even for a temporary period, and wishes to obtain payment at a different post office it is necessary to return the book of payable orders to the Department. This arrangement is part of the control mechanism for the order book system and to depart from these arrangements would significantly weaken a fundamental control element. Every effort is made to ensure that, where a pensioner returns the book in these circumstances, the changes are implemented without delay, so that a new book will issue within the week to the new post office. This minimises any interruption of payment to the pensioner.

At a more general level, I am committed to providing payment options to people in receipt of social welfare payments. In the case of old age pensions those receiving contributory pensions may opt to have their pension credited directly to their bank accounts by electronic fund transfer. This option is now being extended to those receiving non-contributory pension. Of course, payments which are credited to the pensioner's bank account may be accessed at banks in other parts of the country. Depending on the person's circumstances this arrangement might provide greater flexibility for the pensioner.

Helen Keogh

Question:

18 Ms Keogh asked the Minister for Social Welfare if he will increase the current death grant paid by his Department due to the escalating costs of burials and in view of the fact that it has remained static since 1982. [3990/96]

Mary Harney

Question:

37 Miss Harney asked the Minister for Social Welfare if he will increase the current death grant paid by his Department due to the escalating costs of burials and also in view of the fact that it has remained static since 1982. [1310/96]

Minister for Social Welfare (Proinsias De Rossa)

I propose to take Questions Nos. 18 and 37 together.

Death grant is a social insurance benefit which is payable, subject to certain PRSI contribution conditions, on the death of an insured person or of their spouse or child under 18. The amount of the grant varies with the contribution record and, in the case of children, with the age of the child.

The purpose of the grant, which was introduced with effect from October 1970, was to help with funeral and other post-bereavement costs. While I accept that the value of the grant has fallen, having regard to average funeral costs, there are other measures in place designed to assist people in the immediate aftermath of bereavement.

For example, where a person dies while in receipt of a social welfare payment, the payment usually continues to be paid to his or her adult dependant for six weeks. In addition, payment may also continue for six weeks after the death of an adult or child dependant.

The rate of death grant is reviewed in the context of the budget each year in common with all other social welfare rates of payment. I am currently reviewing the present arrangements with a view to developing improved provision for income support for bereaved person generally.