Vol. 494 No. 5
42 Mr. Gormley asked the Minister for Social, Community and Family Affairs if he has satisfied himself that the national anti-poverty strategy is proving to be an effective instrument in tackling issues such as child poverty and rural poverty in the light of recent reports which show both of these to be increasing even as the economy generates greater affluence for others; and if he will make a statement on the matter. [18702/98]
51 Mr. Sargent asked the Minister for Social, Community and Family Affairs the policy of his Department in seeking to eliminate child poverty which has become an entrenched feature of the economy; and if he will make a statement on the matter. [18701/98]
I propose to take Questions Nos. 42 and 51 together.
The provision of income support in respect of children plays a crucial role in combating the incidence of child poverty. There is widespread agreement that child benefit is one of the more effective mechanisms for the provision of child income support. It is effective in tackling poverty as it channels resources directly to families most in need and is of particular importance to families on low incomes. As it is not taxable, and is not withdrawn when an unemployed parent takes up employment nor assessed as means for other secondary benefits such as differential rents, medical cards and so on, it does not act as a disincentive to taking up employment or improving wages. Substantial increases to the monthly rates of payment in recent budgets established the growing importance of child benefit within the overall child income support system, with a particular focus on the needs of larger families. The increases provided for in the 1998 budget are targeted especially at larger families, who are at greater risk of poverty. With effect from last month, the rates of child benefit were increased by £1.50 for the first two children and by £3.00 for the third and subsequent children. This brings the lower rate up to £31.50 and the higher rate up to £42.00. A family with four children, for example, will now receive monthly payments of £147 or almost £37 per week.
This year's budget also made provision for the introduction of a new payment of 150 per cent of the normal child benefit rate for twins.
In addition, family income supplement plays a significant role in assisting low income families through the payment of a regular weekly supplement to parents on low pay. The scheme is now calculated on a net income basis which will significantly increase the supplements payable under the scheme.
Research has shown repeatedly that unemployment is a key factor in producing poor households, and this is particularly true for households containing children. For this reason, the continuing fall in the level of unemployment, allied with the significant rise in employment, will have a positive impact on the level of poverty among Irish children.
The introduction, under the national anti-poverty strategy, of a system — referred to as poverty proofing — of assessing the poverty implications of significant policy proposals will also ensure that the needs of poor children — and other groups experiencing or at risk of falling into poverty — are addressed at policy design stage.
The continued development of the NAPS will ensure that further initiatives under the five key themes of — unemployment, income adequacy, educational disadvantage, disadvantaged urban areas and rural poverty — all in themselves contributors to the perpetuation of the poverty cycle throughout generations of families — will assist in producing a society that lifts the burden of poverty from Irish children.
The problems of poverty and social exclusion in rural areas are being addressed as part of the overall NAPS strategy. Actions under the NAPS in relation to addressing the underlying causes of unemployment, income adequacy and educational disadvantage apply equally to urban and rural areas.
In relation to rural poverty, the Combat Poverty Agency is conducting a study on farm income support policy. As this is an area of particular interest to me, in my first meeting with the agency on coming into office I requested them to put particular emphasis on rural poverty when developing their proposals for this study. I am looking forward to receiving the results of the study early next year.
I understand the Department of Agriculture and Food is currently preparing a White Paper on Rural Development which will deal with the economic and social development of rural areas and will include a particular focus on issues relating to poverty and social exclusion.
I thank the Minister for his detailed reply. Would he agree that it is ironic, and even obscene, that so many politicians are publicly congratulating and preening themselves on the "success" of the Irish economy while one third of children live in want, and almost 60,000 adults, probably more, receive weekly incomes that 12 years ago were found to be less than adequate? In the light of that stark comparison, would the Minister agree that Government policy as it is structured means that children all too often fall between the stools of different Government Departments? Has the Minister any proposals to remedy this, given that the Minister of State, Deputy Frank Fahey, deals with children under the heading of child care, the Department of Education and Science deals with children under another heading but in the area of play facilities for children no Minister takes responsibility? As Minister with responsibility for the family, would the Minister agree that children are suffering because of this lack of cohesion?
I would not accept that there is lack of cohesion. The issue of poverty and other issues relating to children are cross-departmental and have always been so. It is like many issues which come to the fore — they do not necessarily rest in one Department. I would not necessarily agree it should be that way. Having said that, the Cabinet subcommittee on social inclusion and drugs, which has met seven or eight times since the formation of the Government, has spent a great deal of time on the issue of children and the co-ordination of policies in relation to children. It is one of the issues on which the Government is very focused. The issue of income adequacy is one of the reasons this and previous Governments targeted the increase in child benefit. It was accepted by all experts in this area that that would be the best way to assist families, particularly larger ones, with the difficulties of income adequacy.
The Minister mentioned the family income supplement and the ongoing studies of rural problems. He said the studies would be dealt with early next year. Is the Minister aware of the extreme crisis at present among the self-employed who are not covered by FIS or any other scheme? When will he bring a resolution of this problem to the Cabinet, whether it is through FIS or some other guise? If he does not do so the children we are talking about today will have no——
Deputy Crawford should confine himself to asking a question.
When will the Minister bring forward a meaningful FIS or a similar programme for the rural community about which he spoke so eloquently a couple of minutes ago? If the Minister is committed to this he should bring this forward now and not after Christmas.
I repeat the fact that in my first meeting with——
Before the Minister replies, Deputy McGrath wishes to ask a related supplementary question.
It will be more efficient if I ask the Minister my question on the same issue now and will save him having to repeat the answer. My colleague, Deputy Crawford, is right in regard to FIS. The Department of Social, Community and Family Affairs has an unanswerable case in relation to the self-employed and FIS. We cannot have a situation——
The Deputy must ask a question.
Will the Minister agree that the case is unanswerable? It is intolerable to say to two families in rural Ireland, one the family of a PAYE worker and the other the family of a farmer with a small business, both of whom are earning £200 a week — figures accepted by the Revenue Commissioners — that one can have income support of £1,750 a year but the other can have nothing. Will the Minister agree that is insupportable? Given the poverty in rural areas and the Minister's commitment to rural areas, this must be looked at urgently.
Does Deputy Browne wish to ask a question on the same point?
(Carlow-Kilkenny): Yes, because Question No. 49 deals directly with that matter and I am sure we will not reach it today.
I can give the Deputy the answer.
(Carlow-Kilkenny): Rural poverty is staring us in the face at the moment. I find it very difficult, as do my colleagues, to know why someone who is poor and self-employed and someone who is poor and in the PAYE sector——
The Deputy must ask a question.
(Carlow-Kilkenny): Will the Minister explain the difference between someone who is poor and in the PAYE sector and someone who is poor and self-employed? How can that distinction be made? How can it be said that people who cannot buy food are better off than people with the same amount of money?
I am aware of and appreciate the difficulties being experienced by the farming community at the moment. I met representatives of the IFA after the all-Ireland final in a Dublin hotel where they expressed their desires and hopes in that respect. I am due to meet with the ICMSA in the next couple of days in this regard. The case was made that there was a very sudden and dramatic difficulty in relation to the fodder crisis. The Government acted on that——
Inadequately.
——and brought forward a package of more than £12 million of taxpayers' money.
(Carlow-Kilkenny): That will only feed the cattle.
The issue of smallholder's dole was brought up by the farming representatives when I met them recently. I indicated to them that 7,000 to 8,000 people qualify for smallholder's dole, which costs £33 million a year. I indicated to the farmers' representatives — it was subsequently communicated in a statement issued by the Minister, Deputy Walsh — that we would look at the issue of smallholder's dole to see how farmers could be assisted because we believe the take-up of smallholder's dole could increase if people were further assessed.
Levels of payment are very different.
It is important to say the issue of FIS for farmers did not just drop out of the sky — this question has been tabled here many times. FIS was introduced in 1984. A figure was calculated in 1994 for the cost of extending it to the self-employed, including farmers. I asked for that figure to be updated, as I undertook to do at a previous Question Time when this issue was raised. I am told the figure could be as high as £80 million. Many changes have taken place since 1994 when the figure of £30 million was calculated.
The only commitment in Partnership 2000 for FIS was that it would be calculated on a net rather than gross income basis, which we fulfilled in last year's budget. Due to that and other changing circumstances, it has been indicated to me that the figure could be as high as £80 million — it may not be that high but it will be much more than the existing figure of £30 million.
Many people accept FIS is not the way to solve the farmers' present difficulties. The issue of FIS has been around for some time. It is quite illustrating that when Deputy De Rossa was Minister he said it would be extremely difficult to police an extension of the family income supplement scheme to the self-employed. He said that self-employed persons make their own returns with regard to income tax and, by and large, they have self-assessment. He went on to say he would not hold out any expectation that he would be in a position to extend FIS to the self-employed. That is what Deputy De Rossa said in 1996.
And I stick to it.
I have to say that he did stick to it.
Deputy Ahern is the Minister now — what is he going to do?
He also said he would be opening up the scheme to such an extent that it would be impossible to target it at those who need it. He went on to say that to extend the scheme would have huge cost implications.
Are we to take it the Minister agrees with all that?
The Minister, without interruption.
Not only that, Fine Gael had a Minister of State in the Department of Social Welfare at that time who said in 1997 on the Social Welfare Bill that, given the estimated cost of such an extension of the FIS scheme and the then Government's priority of achieving the commitment in Partnership 2000 to reform the assessment of FIS, they had no plans to extend it to the self-employed.
I am committed to this, as I said in the Dáil. I specifically asked the Combat Poverty Agency when I met it to give its attention to the issue of rural poverty because I, like many Members across the House, accept these are difficult times in farming. The Government addressed the immediate problem with a package. However, there is also the medium to long-term issue of decreasing incomes and the decreasing prevalence of small family farms. That is a broader issue which warrants greater research in conjunction with the negotiations on Agenda 2000 and other matters.
The Government is committed to looking after farmers as best it can. If my Department has its way it will do it, and I will not be found wanting. However, we must be realistic; we are looking at protecting farmers on low income and we regard the smallholders' dole as a vehicle for looking after people who are struggling to put bread on the table. My Department will endeavour to get as many farmers as possible to apply for the smallholders' dole, so they can comply with the terms of the scheme.
Pig farmers have no income.
I regret that this issue has been diverted into another debate on family income supplement, because that is not the key to solving poverty either in rural areas, among farmers or the self-employed. The statistics show that rural poverty is not farm family poverty — that is part of the problem but it is not the bulk of it.
On the National Anti-Poverty Strategy, what proofing mechanism is in place for the proposals coming through the Minister's and other Departments for the December budget? Will it be used to proof proposals for all Departments? Does the Minister agree that the delivery of support for child care in whatever form — whether the hiring of child care assistants, paying for cre ches or helping to rear a child — should be through child benefit and not through tax relief? Child benefit delivers support in a fair way across the board to every child regardless of the parents' income, and any attempt to switch resources to tax relief for child care would be a mistaken approach to take to child poverty and child care.
A comprehensive set of guidelines to assist in the proofing of significant policy proposals for their impact on the poor has been drawn up by the NAPS unit in my Department. The Government made a decision on poverty proofing in July this year. As to identifying particular groups, a framework paper was agreed by the social partners earlier this year, which identifies social groups, including children, which are at the greatest risk of experiencing poverty. Those groups will receive particular attention in the policy design process to ensure the impact of the proposals on these groups.
One only had to watch last night's "Nine O'clock News" to see two diametrically opposed views on child care. The review is due shortly and the Government will then have to make decisions on the issue. It is accepted that many people would not benefit from a child care tax allowance. The Deputy found this when he was Minister — he announced a scheme for security for old people but it was pointed out that a large proportion of that section of the population did not pay tax, so tax relief would be no good to them. He then had to introduce an alternative community support scheme. Similarly, anyone making a policy decision on child care would have to take into account those who are not in the tax net and would not benefit from tax relief. That is another issue and is not specifically in my area, although child benefit is. It is the view of this Government that increases in child benefit should be examined continually.
The Minister believes the Government's policy on children is cohesive and cites the interdepartmental approach to drugs. Does he agree that tackling the drug problem is rather a late stage to develop a common approach? Does he take on board suggestions from people working in the child care area, who are interested in children and the family, that it is necessary to look at preventing problems? I cited the lack of responsibility in the Government for such basic things as play facilities — I am not asking his Department to take it up but——
Please, Deputy, a brief final supplementary, I would like to give the Minister time to respond.
I would like to tease out one point——
You cannot tease out anything, you can ask a brief supplementary question. I wish to allow Deputy Durkan's question as he has waited all afternoon.
Will the Minister look again at an interdepartmental approach to child poverty, so that we prevent problems rather than looking for solutions when the problems happen? On rural poverty, will he accept the suggestion of the Conference of Religious in Ireland, among others, that a guaranteed basic income has an important role in tackling poverty and the widening gap between rich and poor? In terms of cost, that would compare favourably with the FIS estimates.
As to co-ordination of policy, the NAPS unit in my Department has responsibility in this area, as does the family affairs unit which I set up this year. Issues relating to children are very much to the fore. For instance, as regards the report of the Commission on the Family, it is the job of the family affairs unit to drive forward some of the issues mentioned by the Deputy. That is up and running and will have some impact over the coming months and years.
