Jim O'Keeffe
Question:36 Mr. J. O'Keeffe asked the Minister for Social, Community and Family Affairs if he will introduce a millennium bonus payment for social welfare recipients for Christmas 1999. [10429/99]
Priority Questions. - Bonus Payments.
Thomas P. Broughan
Question:37 Mr. Broughan asked the Minister for Social, Community and Family Affairs the cost of providing a once-off double payment to all social welfare recipients; the plans, if any, he has to make such a payment for the last week of 1999 to mark the millennium; and if he will make a statement on the matter. [10560/99]
I propose to take Questions Nos. 36 and 37 together.
An amount of £42 million is provided in my Department's 1999 Estimates to provide for payment of a Christmas bonus for approximately 715,000 recipients of long-term social welfare payments.
This estimate is based on the payment of a bonus in 1999 similar to the bonus paid in 1998 and earlier years, i.e., 70 per cent of the person's normal weekly payment subject to a minimum payment of £20.
The bonus is paid to recipients of disablement pension; death benefit by way of pension; old age contributory and non-contributory pension; retirement pension; invalidity pension; widow's and widower's non-contributory pension; orphan's contributory and non-contributory pension; pre-retirement allowance; blind pension; carer's allowance; one parent family payment; unemployment assistance at the long-term rate; disability allowance; payments to people formerly in receipt of deserted wife's benefit and allowance and prisoner's wife's allowance.
The bonus is normally paid in the second week of December. The cost of increasing the bonus payment to 100 per cent based on 1999 payment rates would be in the region of £18 million. A once-off double payment to all recipients of weekly social welfare payments would cost an additional £75 million.
As the Deputies know I have already provided for substantial increases in the weekly rates of social welfare payments and family income supplement payable from the first week in June next at a full year cost of £206 million. These included a £6 increase in payments to pensioners and a £3 increase in the personal rates of other social welfare payments. This means that the contributory old age pension will now amount to £89 per week, an increase of £11, or 14 per cent, on the rate when this Government took office and one-third more than the Rainbow Coalition provided in three budgets.
Any change in the Christmas bonus or the provision of a special double payment to mark the millennium would have substantial cost implications and would have to be considered in the context of other priorities and commitments.
Would the Minister accept that the cost of the 1999 Christmas bonus proposal is £42 million and that doubling payment would cost an additional £42 million? Does he accept that there will be an Exchequer surplus of £1 billion by the end of this year? To mark the millennium, will he not agree that it would be fair to the 700,000 people who rely on the bonus to celebrate Christmas, to make a once-off payment from that enormous surplus?
The Government is conscious of the significance of the millennium. To mark 1999 as the year of the elderly, the Government repeated a measure introduced in its first budget and awarded an increase of £6 to old age pensioners on the maximum rate – an increase of almost four times the rate of inflation.
The Minister for Finance took 15,000 old age pensioners out of the tax net in the budget – the highest number of pensioners ever taken out of the tax system. The Minister for Health and Children brought forward proposals for a programme over three budgets to bring more people over the age of 70 into the medical card system. These measures were introduced to commemorate 1999 as the year of the elderly.
The Government has been developing plans for the millennium. The Minister of State, Deputy Séamus Brennan, is the chair of the Millennium Committee which has £30 million of public funds and additional private sector funds to commemorate the millennium. All Departments are conscious of the fact that we should commemorate the millennium.
We have had growth rates of 10 per cent this year and last year and huge growth is projected up to 2010. Many sections have done very well, including semi-State employees such as those in Telecom Éireann. Surely this gives the Minister an opportunity to put something into the pockets of the poorest one third of society.
The Minister disputed some of the points in the ESRI report published before Christmas but he cannot contest that we are spending a declining percentage of GDP on social welfare – the figure is now under 10 per cent. This is an important year and some groups are hyping up the millennium and looking for additional moneys. However, there will be a lengthy holiday period which will create financial difficulties for people such as senior citizens, those on invalidity and disability benefits and carers. Surely this is an ideal opportunity for the Minister to ask the Minister for Finance to provide additional funds to give an extra bonus payment.
We discussed increases announced in the budget which are introduced months later. Many of my constituents commented unfavourably on this issue. This is an ideal opportunity for the Minister to give a little to the poorest section of society. I do not suggest that we should not deal with long-term issues regarding child benefit and pensions and I commend the Minister on the progress he has made in that regard. However, this is an opportunity to create a more inclusive society and to make a significant gesture towards the poorest one third of society.
Since taking office the Government has shown that it is conscious of the need to help the less well-off. In two budgets we have increased old age pensions by a sum equal to the increases in the three years of the previous Government.
That has nothing to do with the question.
The social welfare package announced in the last two budgets has increased by 49 per cent over the figure during the previous two years under the rainbow coalition Government. The Government's record on looking after the less well-off as well as possible is recognised.
To give a double Christmas bonus would cost an extra £42 million. Deputies will appreciate that this is a significant amount and well over the amount available to the Millennium Committee which has £30 million. If that money was available we would have to consider whether it would be better spent on carers or those with a disability. I am not saying it is available but the decision would have to be made in the context of the preparation of the Estimates and the budget.
The Minister might do it.
I will not repeat what was done by Governments of which Deputies on that other side of the House were involved. The only two cuts which ever took place in the Christmas bonus occurred under Labour Party and Fine Gael Governments.
The Minister did not change it.
The Minister should get off his political bandwagon and try to get to the bones of this question. Does he not accept that we are dealing with the "have-nots"? We are talking about pensioners, the disabled, widows and the long-term unemployed – about 700,000 people. Does he not accept that they are as entitled to mark the millennium as the "haves"? Does he not accept that, without assistance along the lines proposed, they will not be in a position to do so?
Does the Minister not agree that we are talking about a once-off payment which would account for only 4 per cent of the expected Exchequer surplus at the end of the year? While I appreciate the Minister does not have funds available at the moment, would he not consider joining with the Opposition parties to send a message to the Minister for Finance that this is an issue about which all parties are making a common case? Would he not feel his hand would be considerably reinforced as a result? I urge the Minister to join our campaign and do something decent rather than leaving the ‘have nots' on their own when it comes to marking the millennium on 1 January next.
Like Deputy O'Keeffe and I, the Minister attended the CORI conference some weeks ago at which Fr. Healy and Sr. Reynolds spoke. One of the points which stuck in my mind was that Ireland currently spends less on social welfare provision or basic income than any other EU country, with the exception of Portugal which some consider to have fundamental infrastructural problems. The Minister seems to be wavering on this matter. Perhaps he feels an urge to align himself with the Opposition spokespersons and ask the Minister for Finance for additional funding. I realise that the provision of such funding will not make a fundamental long-term difference – we have yet to act on child care, carers, senior citizens, pension provisions and so on.
The Deputy is making a statement; he should put a question to the Minister.
I floated this idea some weeks ago in response to comments made in the media in regard to spongers. Will the Minister associate himself with me in decrying comments made by a columnist in the Daily Star newspaper which constituted a totally unwarranted attack on senior citizens, widows and the long-term unemployed? I call on the journalist to recall her attack on people who are dependent on State welfare, through no fault of their own.
Spending on social welfare currently exceeds £5.1 billion which is approximately 25 per cent of all Government spending. To say we are not spending much Exchequer funding on social welfare is incorrect.
It is under 10 per cent of GDP.
One can consider social welfare spending as a proportion of GNP and compare it with spending in other countries. For example, if one looks at a graph of the amount spent in each EU country on old age pensioners, one will see that Ireland spends the least and Italy spends the most. That is not because we are paying individual old age pensioners less than they are paid in Italy or elsewhere. We have a relatively young population; other countries such as Italy, England and Germany are obliged to spend more on the global figure because they have far more old age pensioners as a proportion of those working than we have. As we have a relatively young population, we spend less on social welfare than other European countries. Since this Government came into office, 55,000 people have left the dole queues and taken up employment and, consequently, social welfare spending has reduced. That is to be lauded. There is nothing better than providing people at the lower end of the scale with jobs and this Government has been extremely successful in doing that. In the past year alone, 95,000 jobs were created.
I read the newspaper article to which the Deputy referred. Not everyone would be in agreement with the proposal which has been made; it is obvious the author of the article does not agree with it. I am not trying to defend the author but she makes the point that while she has no problem paying for old age pensioners, she has a problem with paying money for people who are claiming the dole and working at the same time. I do not believe anyone in this House would disagree with her on that.
We will keep up the pressure on the Minister.
Deputy O'Keeffe does not have a monopoly on ideas.