Dáil Éireann debate -
Tuesday, 9 Jun 1998

Vol. 492 No. 1

Written Answers. - Social Welfare Benefits.

Nora Owen

Question:

179 Mrs. Owen asked the Minister for Social, Community and Family Affairs if he will recommend in the next budget that increases to widows, widowers and old age pensioners be allocated on the basis of a flat rate rather than a percentage in view of the fact that it is evident that using percentages gives an inequitable increase to someone on small allowances as opposed to someone on a higher benefit or wage; and if he will make a statement on the matter. [13332/98]

Minister for Social, Community and Family Affairs (Mr. D. Ahern)

The question of the level of increases in social welfare payments to be provided in the next budget will be decided having regard to the available resources and in the light of the Government's other commitments arising from An Action Programme for the Millennium and Partnership 2000.

A key priority of the Government in An Action Programme for the Millennium is that the old age contributory pension will be increased to £100 per week over a five year period. As a sign of its determination in this regard, the Government has gone beyond what is strictly required by that commitment in the first year. A special catch-up increase of £5 per week has been provided in the maximum personal rates of all payments for pensioners aged 66 and over, with pro-rata increases for older people on reduced rate contributory pensions. Payments for all others have been increased by £3 per week, with pro-rata increases for those on reduced rate contributory payments.

Reduced rate contributory payments are made in cases where a claimant has fewer than the required standard of social insurance contributions. The level of benefit payable in such cases is generally set as a percentage of the maximum payment. For example, in the case of the old age contributory pension, a yearly average of 48 contributions is required in order to qualify for the maximum rate of pension. However, a person with a yearly average of between ten and 14 contributions can still qualify for payment, but at a reduced rate. The rate of pension in this case is set at 50 per cent of the maximum pension. Accordingly, the level of increases provided to recipients of reduced rate contributory payments is determined by the percentage relationship between that reduced rate and the appropriate maximum rate of payment.

The increases which have been provided for in this year's budget have benefited some 890,000 social welfare recipients. Approximately 270,000 pensioners aged 66 and over have had their payments increased by £5 per week, with some 54,000 people on reduced rate contributory pensions receiving proportionate increases. Approximately 560,000 people under 66 years have had their payments increased by £3 per week, with some 6,000 people on reduced rate contributory payments receiving proportionate increases.