Vol. 517 No. 6
78 Mr. O'Shea asked the Minister for Social, Community and Family Affairs the plans, if any, he has to review the general increase in social welfare levels announced in the budget in view of the fact that year on year inflation is running in excess of 4%; and if he will make a statement on the matter. [10527/00]
While the latest published monthly CSO report on the consumer price index highlights that in the year to February 2000 inflation increased by 4.3%, the Minister for Finance in his Budget Statement has estimated that the annual average inflation rate for the whole of 2000 will be 3%.
The recent social welfare budget package, which is the biggest ever social welfare budget allocation amounting to over £428 million on a full year basis, provides for a £7 a week increase for pensioners over 66, a special increase of £5.90 a week for invalidity pensioners aged under 65 years and a £4 increase for other recipients under 66.
The £7 increase for pensioners represents an increase ranging between 7.9% and 8.9%, while the £4 general increase represents an increase ranging between 5.2% and 5.6%. With an expected annual average inflation rate of 3% for 2000, this year's increases will be ahead of expected inflation, representing real increases ranging between 2.1% and 5.7%.
In addition, special increases in the rate of qualified adult allowances are being provided for this year, as part of an overall strategy to increase this allowance to 70% of the main rate by 2002. These increases, which range between 7.7% and 17.2%, represent real increases of between 4.6% and 13.8%.
Furthermore, as part of the process of aligning tax and social welfare changes by 2001, all of these increases are being paid four weeks earlier this year, from the beginning of May.
The Government is committed in its action programme to providing substantial social welfare increases. Specifically, the recent review of the action programme has committed the Government to bringing forward from 2002 the target date for increasing the old age contributory pension to £100 a week and to extending the commitment to achieving this target rate to all social welfare pensions for older people by 2002. The Government is also committed to ensuring that over its term of office all old age pensions will increase in line with average industrial earnings.
