Vol. 497 No. 2
27 Mrs. B. Moynihan-Cronin asked the Minister for Social, Community and Family Affairs the provisions which his Department has made to enable lone parents to have their social welfare payments made directly to their bank accounts; and if he will make a statement on the matter. [24822/98]
My Department has been making payments by direct credit to customer bank accounts for a number of years. The facility know as electronic fund transfer is available across a number of the Department's schemes. Unfortunately, for operational reasons, it has not been possible to extend the facility to one parent family payment. Software changes must be made to the computerised payment systems to enable this to be done and other administrative changes are also required.
The EFT option will, however, be extended to other categories of customers as quickly as the necessary changes can be made allowing for other priority projects. It is my intention that the option will be offered to lone parents as early as possible in 1999. In the meantime, a specific card based electronic payment system has been developed by the Department for lone parents, as well as the unemployed, to enable them to avail of the household budgeting facility provided by post offices. Through this system, customers can have payments in respect of rent, mortgage, electricity and telephone bills deducted from their social welfare allowance each week at their designated post office. More than 2,000 lone parent customers are now availing of this option. This facility will continue to be available as an option after the introduction of the more comprehensive electronic funds transfer system for lone parents.
What proposals are under way to have this facility made available to lone parents? I was surprised to discover it was not available to them.
One of the major issues in relation to technology in my Department is to comply fully with the year 2000 issue. This has been ongoing for quite some time. The Department is concentrating on that matter but the facility to extend EFT to lone parents will be put in place as soon as possible — I hope it will be in early to mid-1999.
What other categories of social welfare recipients are not provided with such a facility?
Perhaps the Deputy would table a separate question in that respect. Some 94,000 child benefit recipients are on EFT and 70,000 beneficiaries receiving other social welfare payments are paid by EFT.
Why does a lone parent need a medical certificate to avail of the banking system? I have been advised by the Department of Social, Community and Family Affairs that for a lone parent to take part in this system he or she must have a medical certificate. I do not understand that.
I am not sure to what the Deputy is referring. The lone parents are dealt with as part of the household budgeting system which is separate. I am not aware of any requirement for a medical certificate in that instance. I have already said that EFT is not up and running for lone parents. If the Deputy gives me some more concrete information I will have it checked.
Is it the Minister's intention to have this facility available from the year 2000 to all social welfare recipients?
There is an effort in the Department to extend this to as many social welfare recipients as possible. At the moment certain recipients of child benefit payments, pensions, unemployment and disability benefit are involved. We hope to extend it to recipients of blind pensions and the carers' allowance in the new year as well as to lone parents. There will be a continuous extension of the facility to give people an option.
I take it from the Minister that carers and blind persons will be facilitated before lone parents.
I cannot give a timescale but it is intended that all of these will be rolled out in the coming year.
28 Mr. J. O'Keeffe asked the Minister for Social, Community and Family Affairs if his attention had been drawn to the fact that family income supplement for the self-employed has been in operation in the United Kingdom and Northern Ireland for many years without any difficulty; and the reason this system has not been introduced here. [24448/98]
The family income supplement scheme was introduced in 1984 with the specific purpose of providing an incentive to low paid employees with families to take up or remain in full-time employment. The problems relating to the scheme were seen at the time as being more acute for employees than for self-employed people.
In the intervening years, the question of extending the scheme to cover the self-employed, including farmers, has been considered on a number of occasions. Such consideration would have regard to a range of factors including: the practical difficulties associated with extending the scheme to the self-employed; the arrangements already in place to provide income support to self-employed people on low incomes; and, most notably, the cost of introducing such a measure in the context of the need to prioritise the use of the limited resources available for the development of the wider social welfare system.
My Department has now completed revised estimates of the cost of extending the family income supplement to the self-employed. Assuming substantial take-up, it could cost between £70 million and £80 million. This cost would be in addition to the existing expenditure of some £43 million under the unemployment assistance scheme paid to self-employed people, including smallholders, on low incomes.
I am aware that the family credit scheme which operates in Northern Ireland and throughout the United Kingdom includes provision for the self-employed. That scheme differs significantly from the family income supplement scheme in the manner in which the income of the income supplement is calculated. However, the Deputy will appreciate that the question of extending the family income supplement scheme to the self-employed must be considered on its own merits and take account of the factors I have outlined and, in particular, the high costs involved.
The Minister on 4 February last gave a figure of £30 million, assuming 100 per cent take-up. Subsequently, on 3 November, he indicated that fewer than one in three of potentially eligible claimants were in receipt of the supplement. Does he accept that his figure of £70 million to £80 million as being a prospective cost is wildly overstated?
I do not. I will tell the Deputy how it is calculated. If we were to extend FIS to the self-employed the estimate is that for smallholders in receipt of UA it would cost £5.3 million with 3,400 families involved; for other smallholders and farmers it would cost £24.3 million, involving 12,700 farmers; for self-employed already on UA it would cost £1.9 million and involve 1,300 families; for other self-employed people it would cost £45.1 million involving 20,000 families. That is a total of £76.6 million involving 36,400 families.
The overall cost would be in the region of £70 to £80 million as we estimate it. Even if there was only a 50 per cent take up, it would be half that figure on top of the £43 million paid by the State for UA for the self-employed.
Does the Minster accept that the present take-up of family income supplement is less than one in three and that, therefore, the figures he quotes are not applicable? If we base it on the present take-up the question of extending family income supplement to self-employed becomes a realistic proposition at not too great a cost.
Does he further accept that there is a major case for the extension of the family income supplement to self-employed farmers, many of whom are living on less than £100 per week, and to small shopkeepers and suppliers of services throughout the State? There is a case in justice to extend the family income supplement to them and it can be done without breaking the budget.
If there is such a great case, Deputy O'Keeffe and his party were not successful in having it implemented when in Government, despite the fact that a number of organisations, including the farmers whom he mentioned, raised it in the negotiations for Partnership 2000 but were not successful in having it included.
One of the issues in the first part of the Deputy's question which was included in Partnership 2000, and was the only reference in it to family income supplement, was that it would be calculated on a net rather than a gross basis. I am pleased to inform the Deputy, if he is not already aware, that I achieved that in the last budget to such an extent that an estimated extra 7,000 families will benefit from the family income supplement.
I agree that the take-up of the family income supplement has not been as great as we had anticipated but there is a substantial information campaign in my Department and in organisations such as the INOU and others to entice other low income families into that system.
The Deputy is aware that I have met the farmers' organisations on a number of occasions and a number of mechanisms have been discussed in regard to the issue of low income farmers with families. That matter is being looked at.
Given the situation North and South, does it not make sense that we should align our system to that which applies in Northern Ireland? Does the Minister accept that even though the family credit is not the same as family income supplement, it is very similar to it? Does it not make sense that we should extend it here along the same lines?
As part of the current examination we have looked at this having regard to the family credit system in the North. It is substantially different. I understand that already the authorities in the United Kingdom are to change that system to one of tax credit.
