Dáil Éireann debate -
Wednesday, 3 Apr 1996

Vol. 463 No. 7

Written Answers. - Social Welfare and Tax Integration.

Mary Harney

Question:

18 Miss Harney asked the Minister for Social Welfare whether he intends to promote further integration of the tax and social welfare systems; if so, the methods by which he intends to proceed; and if he will make a statement on the matter. [7230/96]

Eric J. Byrne

Question:

43 Mr. E. Byrne asked the Minister for Social Welfare the progress made to date by the expert group on the integration of tax and social welfare; and if he will make a statement on the matter. [7212/96]

Minister for Social Welfare (Proinsias De Rossa)

I propose to take Questions Nos. 18 and 43 together. The expert working group on the integration of the tax and social welfare systems was established in July 1993 by the former Minister of State at the Department of Social Welfare. The terms of reference of the group are:

To identify the problems arising from the interaction of the tax and social welfare systems and to identify the steps necessary to achieve greater co-ordination/integration of the two systems, with particular attention to the impact on people's incomes, and to the tax code, social welfare system, budgetary and administrative implications.

The expert group was asked to furnish an interim report on measures which could be undertaken in the 1994 budget to reduce poverty traps and increase incentives to work. They presented this report in late 1993. In this interim report, the working group made two specific recommendations for the 1994 budget. These were the easing of the means test for lone parents allowance in order to make it more attractive for lone parents to take up work, and abolition of the arrangement whereby employers of medical card holders had to pay the health contribution and employment and training levy on behalf of these employees. Both of these recommendations were acted on in the 1994 budget.

The group also submitted proposals for this year's budget. These included the retention of child dependent allowances for up to thirteen weeks when an unemployed person takes up employment, the retention of the medical card on taking up employment, and simplification of the means test for casual workers on unemployment assistance. These measures were included in this year's budget.

The group is now completing its final report, and I understand that this report is likely to be finished shortly. When I receive the report, I will then consider the best way of making further progress on integration of the tax and social welfare systems.