Joe Walsh
Question:167 Mr. J. Walsh asked the Minister for Social Welfare the plans, if any, he has to remove poverty traps for low and middle-income workers; and if he will make a statement on the matter. [24930/96]
Written Answers. - Poverty Traps.
The Expert Working Group on the Integration of the Tax and Social Welfare Systems identified two priority areas which need to be addressed in order to reduce poverty traps and work disincentives. These were: reform of child income support and tax reform.
The Government Programme already commits us to reform in both of these areas.
In relation to income support for children, we have already been taking steps to ease the poverty trap associated with the current structure of child income support. Child benefit has a particular role to play in this respect; since it is not dependent on the income or work status of the parent, it does not contribute to poverty traps. We have been gradually improving child benefit in recent years. Child benefit has been increased by 45 per cent since this Government took office.
The second main factor contributing to poverty traps is the taxation of people on low incomes. The expert group's report recommended that policies for taxation of the low paid should be directed towards limiting and eventually abolishing the exemption limits, by increasing personal allowances at a faster rate than the exemption limits. This Government has already made considerable progress on reducing the tax burden. Over the last two budgets, the personal tax allowance for a married couple has increased by £600; the general exemption limit for a married couple has also been so increased by £600 over the last two years. Progress has also been made on widening the tax bands.
Further progress on both of these issues will be considered by the Government in the context of the budget.
Joe Walsh
Question:168 Mr. J. Walsh asked the Minister for Social Welfare his definition of the poverty line; the estimated number of Irish persons living below this level; and the initiatives, if any, he has to reduce this number. [24931/96]
There is no widely agreed definition of the "poverty line" although the term is in widespread use. Living conditions vary from country to country at any one time and living patterns in any given country change over a period.
Drawing on the academic debate on the experience gained from European poverty programmes the following definition is used as a working definition of poverty for the development of the National Anti-Poverty Strategy.
People are living in poverty, if their income and resources (material, cultural and social) are so inadequate as to preclude them from having a standard of living which is regarded as acceptable by Irish society generally. As a result of inadequate income and resources people may be excluded and marginalised from participating in activities which are considered the norm for other people in society.
There is widespread acceptance of the view that poverty should be seen in terms of the standard of living of the society in question. As a consequence, relative poverty lines have been put forward as a useful indicator of poverty in a given society at a point in time.
The Economic and Social Research Institute, ESRI, has undertaken a considerable amount of technical research and analysis in this area. Their report, Poverty in the 1990s: Evidence from the Living in Ireland Survey, which was published today, utilises the 1994 Living in Ireland Survey to provide an updated picture of poverty in Ireland.
Results based on these 1994 data show that approximately 6 per cent of households have an income at or below 40 per cent of mean household income, approximately 18 per cent of households have an income at or below 50 per cent of mean household income and approximately 34 per cent of households have an income at or below 60 per cent of mean household income.
The usefulness of these analyses is not the percentages themselves, which depend on the poverty line one chooses, but rather the description of the groups at relatively greatest risk of poverty, and the trends over time.
Further analyses is contained in the report Reviewing the Commission on Social Welfare's Minimum Adequate Income, also published by the ESRI today. Both reports form part of a substantial programme of research being carried out by the ESRI, which is sponsored by the Department of Social Welfare and the Combat Poverty Agency. The national anti-poverty strategy (NAPS) is now entering a key phase of its development. Much has been achieved since the launch of the strategy following the UN World Summit on Social Development, held in Copenhagen in March 1995.
Five working groups, including departmental officials, representatives of the social partners and of the national anti-poverty networks were established to examine the five key themes identified under the NAPS. These groups have in each case now completed or are in the process of completing their reports to the interdepartmental policy committee, which has been established to formulate the development of NAPS. This follows on from an extensive consultation process which included seminars on the various key themes held in Dublin, Cork, Galway and Limerick.
In addition, each Government Department is currently finalising a strategic statement in relation to its anti-poverty policy drawing on a review of relevant policies. It is intended to make a report to Government as soon as the various Working Group reports and departmental statements have been completed, with a report being made to the United Nations on progress with the NAPS in the New Year.
The Inter-Departmental Committee, with the assistance of the Combat Poverty Agency, is also in the process of finalising the Overview Statement in relation to the National Anti-Poverty Strategy, the draft of which was published this time last year.
The reports published today by the ESRI, Poverty in Ireland; Evidence from the 1994 Living in Ireland Survey and A Review of the Commission on Social Welfare's Minimum Adequate Income, together with the National Anti-Poverty Strategy, and other key reports, such as that of the Expert Working Group on the Integration of Tax and Social Welfare, will contribute to informing public debate on the issue of poverty, while also providing a basis for assessing the adequacy of the current rates of social welfare entitlements and the standard of living of social welfare recipients.