Dáil Éireann debate -
Wednesday, 21 Apr 1999

Vol. 503 No. 4

Written Answers. - Social Insurance.

Michael D. Higgins

Question:

62 Mr. M. Higgins asked the Minister for Social, Community and Family Affairs his views on the future of social insurance in view of the increase in the number participating in the workforce and paying PRSI; if the range and level of social insurance benefits will be maintained or improved; and if he will make a statement on the matter. [10336/99]

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

The Government, in its action programme, is committed to the development of the social insurance system and to increasing the maximum personal rate of contributory pensions to £100 per week by 2002. Significant progress towards achieving this target has been made in the last two budgets which provided for a total increase of £11 per week, to £89 per week, in the maximum personal rates of contributory pensions. Apart from pensions, the social insurance system provides for a range of important short-term benefits such as unemployment and disability benefits. These benefits have been subject to ongoing improvement over the years. For example, a new bereavement grant was introduced earlier this year replacing the death grant. The grant is increased from £100 to £500 and cover was extended to include the self employed and modified PRSI contributors.

I have already indicated to the House that it is my intention that a possible role for social insurance in supporting people who leave employment to care for another person or a further PRSI benefit arrangement for care recipients needs to be explored. These issues will be progressed by my Department during the course of this year.

In recognition of the importance of the pensions area generally, and social insurance, in particular, a number of important developments have already taken place. The report of the pensions board relating to the national pensions policy initiative contains a number of major recommendations regarding social insurance pensions. These include a recommendation that steps should now be taken to establish an explicit mechanism to fund, at least partially, the prospective substantial growth projected in social welfare old age pensions. I welcomed the report and indicated that the board's proposal in relation to part pre-funding of pensions deserved full examination. An interdepartmental working group is currently carrying out this examination and will report later this year.

The financial position of the social insurance system is secure in the short-term. However, the projected increase in the number of older persons in society in the medium to long-term will place significant additional burdens on the system. Following careful examination of the present position, we need to make decisions and, most importantly, to carry these decisions through so that we deal with the medium to long-term issues.