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Dáil Éireann debate -
Wednesday, 11 Dec 2002

Vol. 559 No. 2

Social Welfare Bill, 2002: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Last night the Minister said the Government was most anxious to protect the weak and vulnerable in society. CORI's overall conclusion on reviewing the Government's six budgets was that the Government had failed to address poverty and social exclusion. There is no doubt about how CORI feels about this.

On the subject of young widows and widowers, I welcome the €11 increase for widows and widowers over the age of 66. However, the increase for a widow I know with four children, three of whom attend secondary school and one of whom attends primary school, is only €6. They live in rural Ireland. She will have to find the increased college registration fees for next year for at least one of the children. She will have to find the increased cost of running a car in terms of tax and insurance. Her late husband drove a diesel car, which also now adds to the cost. An increase of €6 for a young widow or widower is unrealistic. I realise that any proposal of mine or of my colleague, Deputy Ring, to increase the cost to the nation, will not be welcome, but I urge the Minister to see whether, over the next 24 hours, she could rejig the figures to find money for this sector. The person I know is in no position to go back to work. I highlight her situation as an example. Another constituent, a young man whose wife died at 32 years of age leaving young children, is equally seriously hit. If he wants to be involved in the workplace, he must pay to ensure that his children are properly looked after.

The idea that somebody is entitled to €11 if he or she is over 66 years of age and to €6 if he or she is under 66 needs to be examined. It is argued that single parents, for many reasons, because the family is divided or they were never married and so on, have similar problems. However, where the husband or wife in a reasonably well-off family dies, this is the sort of payment on which the family must rely. Payments for dependant children are not increased either. That is unacceptable.

As I listened with interest to a number of Government Deputies highlighting the fact that someone fortunate enough to get into a nursing home will now be able to have his or her own telephone I thought of the people who are on waiting lists for nursing home subventions or who have been denied the subvention on some technicality. I would welcome the provision of extra comforts for residents of nursing homes if the major issue of the availability of subventions had been dealt with first. The provision of nursing home subventions is the responsibility of the Minister for Health and Children but the Minister for Social and Family Affairs shares Cabinet responsibility and I hope she will examine this very serious matter. Aged and disabled people cannot get access to subventions.

I had a sad telephone call to my office this morning. A man who had been desperately hoping a subvention could be provided for his wife, who had suffered a stroke and has been in hospital for the past five weeks, rang to say there was no further need for me to seek the subvention because his wife died this morning. This sad story will provide some relief for the health board. This man had been told it would be impossible or very difficult for him to get help to look after his loved one.

The issue of carers must be examined although there have been improvements in recent years. Of the 100,000 or more carers only 23,000 are getting any help. I know of cases, as I am sure the Minister does, of people who have been looking after an aged in-law and who lose the carer's allowance when their spouse dies because they cannot receive carer's allowance as well as the widow's or widower's pension. Some leeway should be given so that a person in receipt of another social welfare payment could receive at least half of the carer's allowance. If such a person got a job he or she would be entitled to retain the widow's or widower's pension but because he or she must stay at home to care for an elderly person that is not possible. I hope the Minister remains in office in order to examine this question.

I return to the issue raised by my colleague last night. How can media publicity and consultants' reports be justified when people are expected to be satisfied with an extra €6 per week? I understand almost €20 million was paid out last year for consultants and reports. We must add to that the publicity, which gives the Department a good profile but at a cost to the nation. Full page advertisements in national newspapers look well and get the Department necessary media goodwill but there must be cheaper way of getting a message across.

The back to work and rent allowances have been capped. When will these spending cuts end? No increase has been granted in the fuel allowance and 190,000 people on short-term social welfare will not get a Christmas bonus. In the last six budgets a single person on social welfare has benefited to the tune of €39 per week while a person earning €50,000 is better off to the tune of €261 per week. Is this an indication of a fair and just society?

I welcome the €10 increase for old age pensioners and any benefit which improves their lives but I condemn the overall thrust of this Bill and of the budget. Those who are worst off will be overcome by inflation and by numerous hidden cuts. Within weeks they will realise that they will be much worse off before the end of this year.

I wish to share time with Deputy Seán Power.

I am glad to have the opportunity to speak on this important Bill and to congratulate the Minister on her achievement in bringing about worthwhile improvement in the social welfare area for the coming year. I have no doubt but that she will continue this programme of investment and reform in the next four years.

Deputy Crawford referred to publications and to the Department's advertising of various schemes. All public representatives receive glossy literature from agencies funded by taxpayers. The Minister has increased the funding for the money advice and budgetary service and for some other agencies which come within the remit of her Department. Of all the agencies established in recent years I compliment MABS on its work with people who have a problem with handling money and who are often unable to make local authority and other payments. I have doubts about the usefulness of much State money which is allocated to the many organisations which have sprung up in recent years. The newspapers on Fridays and Sundays are full of advertisements for jobs with agencies which are of questionable benefit to the country. Each Department should review the value given to taxpayers by the money given to a plethora of organisations whose duties and briefs overlap and who often do not give value for money. However, from speaking to officials at local level I know MABS does an excellent job. I am glad the Minister has provided additional funding and that the service's programme of work for the next three to five years is secure.

I also compliment the Minister on the extra funding being provided for the community development programme. From working with groups in my own constituency I know that small State assistance is being put to excellent use by people working on a voluntary basis in the least advantaged areas.

We can all join Deputy Crawford in sympathising with the widow with four children, one of whom hopes to go to third level next year. We appreciate the struggle that woman has to survive and the difficulties widows with children face in trying to make ends meet. If that young person succeeds in getting a third level place next year he or she will not face college registration fees. If the household income is as low as Deputy Crawford says the student will be entitled to a maintenance grant and the registration fee will not be applicable.

When we talk about making education more accessible to people from less advantaged homes we should not forget the extension of maintenance grants to the post-leaving certificate sector in the past number of years. A greater number of students going to colleges of further education are from less well off homes than is the case in traditional third level institutions. The extension of maintenance grants to this sector has enabled many students from less well off homes to avail of further education and to complete certificate, diploma and degree courses at third level.

I compliment the Minister on the substantial increase she has obtained for her Department in the coming year. The budget improvement means an additional €530 million for her Department. This continues the work of her Cabinet colleague, Deputy Dermot Ahern, as Minister for Social, Community and Family Affairs. I am particularly glad that the emphasis on improving pensioners' incomes is being continued. The Minister has made a clear commitment that the old age pension will rise to €200 per week within the lifetime of this Government and all of us want to see such an achievement. This House should fully recognise that the pensioners of today built this country during very difficult times and suffered a great deal of hardship and drudgery in their lives. Our generation has not had to make the sacrifices that the previous generation made as they attempted to provide a decent standard of living for their families. I am pleased by the increase of €10 in the old age pension in this Bill and I am satisfied that the Minister, Deputy Coughlan, is committed to the achievement of the €200 target I have mentioned.

Deputy Crawford referred to a statement by the Conference of Religious of Ireland, but I do not think the pensioners of Ireland need to read any such documentation to help them to analyse the improvements in the social welfare system in recent years. They are probably more appreciative than any other sector of the developments since 1997. The improvements, that have not come about before time, are welcome and are enjoyed by pensioners. The contributory pension was just over £70 in 1997, but it had increased to £116 by the start of this year.

Very important improvements have also been made to the free schemes, which in many instances were not available to pensioners because of the composition of their households. The previous Minister in this Department, Deputy Dermot Ahern, and his officials brought about worthwhile and important improvements which have meant an additional income in households. I welcome such initiatives.

There has been enormous and welcome progress in relation to the child benefit scheme. Increased payments have been appreciated by the parents of Ireland as they have helped to ease financial burdens in many cases. Many children living in less well-off families have a better standard of living as a result of the improvements in this regard.

At the outset, I would like to congratulate Deputy Coughlan on her appointment as Minister for Social and Family Affairs. I know she has been in the job for some months, but this is the first opportunity I have had to congratulate her in the House while she is dealing with a Bill. Her appointment was welcomed by all parties and I wish her a long and successful term in office.

People often tend to discuss social welfare matters in monetary terms alone, but I do not believe they can be addressed purely in such terms. When we raise the topics of poverty and social exclusion, we should be talking about the starving thousands in Ethiopia, as I did when the Taoiseach was in the House earlier. People in countries like Ethiopia have to live in hope as they do not know from where their next meal will come.

That is happening in Ireland too.

If there is to be any justice in the world, we have to reconsider how we treat those living in such distress and hunger, so close to the rest of the civilised world. This is especially true when one considers the amount of money that is spent on arms internationally. I hope we will see a united international effort to deal with these problems.

I do not deny that there is poverty in Ireland, as I deal with it and meet those who suffer from it on a daily basis. When the Government was elected in 1997, it acknowledged the existence of poverty and social exclusion in Ireland and put in place a number of measures to deal with such problems. Countries can be judged by how they treat the less fortunate in society. Bad luck can be the cause of the problems of many people on social welfare. Some people are permanently dependent on welfare payments and others receive such assistance on a temporary basis. It is important that payments given to social welfare recipients not only allow them to survive, but help them to live with dignity. I do not like to generalise or to paint everybody with the same brush, but it is true that social welfare recipients often feel excluded or marginalised. It may seem to them that the community does not value them in the same way that it values those in full-time employment. The same phenomenon sometimes applies to women who work in the home. These issues need to be addressed.

For many years, the attraction of remaining unemployed was greater than the attraction of work, as there was no incentive to work. It is important that there is a balance between the moneys taken home by those who are employed and those who are not. If the country is to remain vibrant, it is essential that work is rewarded well. Some of the measures taken by the Government in recent years have helped to ensure that the incentive to work remains.

I read an article recently that criticised Ireland for having low taxes. The writer asked how our economic and social infrastructure can be expected to catch up with the rest of Europe if we continue to sustain a low tax economy. I regard such thoughts as left-wing nonsense. If we examine some of the effective measures taken by the Government that may have seemed to benefit the well-heeled in society, we will see that they benefited us all. The Minister for Finance received a great deal of criticism when he reduced capital gains tax from 40% to 20%, but his critics were dealing with the perception rather than the facts. Capital gains tax yielded €59 million to the Exchequer in 1994 and €57 million in 1995. In 2001, however, the yield was €876 million, which was more than in 1997, 1998 and 1999 combined.

Can the Deputy tell the House how his statistics relate to the Social Welfare Bill, 2002?

The Government was able to increase its social welfare expenditure in recent years as a result of the increased revenue from capital gains tax. I know that Deputy McCormack gave up his constituency clinics some years ago—

I am still here, anyway.

—but it is important that he should keep in touch with the pensioners of Galway.

The Government will give them free telephones in nursing homes, but it will not help them in nursing homes.

If the Deputies opposite speak to parents, they will hear that the significant increases in child benefit have been welcomed.

We should ignore the idea that profit is a dirty word. Profit should be encouraged, as if businesses are not making money, the Exchequer will not receive enough taxes. I support those who run their businesses well and make profits. If we did not have entrepreneurs who are prepared to take risks by putting their money on the line in establishing businesses, we would not have profit or employment. It is important that we create an environment in which people are prepared to take risks, as we will all benefit as a result.

The Government's low tax policy has succeeded in eliminating many black economy activities. It was always very difficult to estimate what the black economy was worth. Many people are happier in a country where there is low tax and a perception that it is paid by everyone. People understand and appreciate that tax must be paid and the vast majority accept the regime which exists and welcome low tax rates. It is important, as an island nation, to remain competitive. If there is not a low tax rate thousand of jobs will be lost. Anyone who looks at the US will see that the famous company Levi Strauss, which is very much associated with the USA, is closing factories and moving to China. The workers in Levi Strauss were on an average of $14 per hour whereas the labour costs in China are closer to 25 cents per hour.

I welcome what the Government has done. The low tax has yielded more and allowed huge resources to be poured into the infrastructure, roads, schools and, in particular, social welfare with huge increases in old age pensions and child benefit. We all realise the serious shortage of child care facilities and the increase in child benefit gave parents a little more freedom of choice and flexibility.

I welcome the Government's decision to make sure all weekly increases take effect from January 2003. For far too long, under all Governments, people having a pint or a few smokes paid increased taxes the day after the budget but, in most cases, had to wait a number of months to enjoy the increases in their social welfare payments. I hope the Government's decision that the increase will take effect from January will be followed by all Governments in all future budgets.

There is no justification in paying all parents child benefit. I know this matter has already been discussed. We talk about cherishing all of our children equally but the job of Government is to spread the resources equally throughout the country in order to ensure the less well off are well looked after. It is madness that one family with a person on an income of €100,000 and two children and another family struggling on an income of €20,000, also with two children, receive the same amount of money. Previous Ministers have said that it would be difficult to implement and, in reality, people are afraid of the reaction of the electorate to such a move. However, it is a move which must be taken. When resources are scarce it is important that they are used properly and the money is directed where it is most needed, and I encourage the Minister to do that.

I have another question about child benefit, which I raised last year and did not receive a satisfactory answer. This year the increase in child benefit is €8 for each of the first two children and €10 for the third and subsequent child. I cannot understand why the third and fourth children – I am lucky to have four children – should be more valuable than the first two. For most parents the most expensive child is the first one, who needs buggies, prams and clothes. In my family the clothes and shoes were passed on to the younger children as the older ones grew. Would the Minister explain the thinking behind this?

Pensioners were singled out over the last five years. The Government made a commitment to pay them £100 per week. I am glad because Governments are often criticised, as are politicians, for not honouring their promises. That was one promise we honoured.

It must be the only one.

Whatever we did, we did it right because they put us back in. We will not go into that, we will leave politics out of it for the moment.

I agree with Deputy Crawford about widows and widowers. Most pensioners very much appreciated their increases. I was talking to a couple of pensioners at the weekend who told me they were living very comfortably and had a lovely income which was more that adequate to meet their needs. Most pensioners find they are in a situation where their children are reared, the mortgage is paid and their expenses are less than those of younger people. There is greater pressure on younger widows and widowers than on other people. I encourage the Minister to look at this and see how greater assistance could be given.

I am sharing time with Deputy O'Dowd. It is difficult for Government backbenchers, and there were two very competent backbenchers in the previous slot, to justify the budget. That is their duty and they had the opportunity of doing it. It must be hard on them because it is difficult to justify the budget from the point of view of social welfare, which is the only aspect we are discussing. Deputy Michael Smith rightly praised the work of the money advice and budgeting service. Deputy Smith knows their services will be greatly used in the coming year as a result of the effects of the budget. Not alone will recipients of social welfare have to use MABS but they will also have to, as many of them do, look for support from their mams and dads to survive as a result of the provisions in the budget.

I regret that Deputy Sean Power, for whom I have respect, has left the Chamber. I was very surprised that he said people on social welfare should be quite pleased and happy when they compare themselves to people in Ethiopia. That was an uncalled for statement. He need not worry about whether or not I have clinics. I do not go to pubs but I give a service to my constituency. I do not go around the pubs, meeting the same three people every month. That is a ridiculous way for a public representative to represent his constituents. I am available to meet them in my office by appointment and by telephone. That is why I will mention many of the things which my constituents have mentioned. I did not survive 15 or 16 years here without giving a service in my constituency, and nobody will. There are different ways of giving a service.

To deal with the budget, it marks the moment of truth for the Government. It has drastically failed to address the substantial poverty and social exclusion which still exists. It has widened the gap between the rich and poor, something which can be proved. We now have the worst gap between rich and poor of any EU state. The budget has failed to attack in any meaningful way the defects in infrastructure and social provisions which see Ireland far below EU levels. It has failed significantly to increase the total tax take to a level closer to the EU level than previously. For example, as a result of the budget, an unemployed couple with one child will be 25 cent per week better off in real terms than they were in 2002. The poverty gap has widened considerably. The gap between a single, unemployed person and a person on €50,000 per year has widened by €25 per week. The number of people living in relative income poverty will continue to rise as a result of this budget.

There has been much loss of essential services in local communities as a result of the cutback in community employment schemes. Those schemes helped people on the margins and did wonderful work in the communities. Community services will be greatly affected as a result of this loss. The budget expects poor people to bear the burden of the Government's mismanagement. It is all the Government can come up with after five years of unprecedented economic boom. The reason Deputy Dermot Ahern asked to be relieved of the Department of Social, Community and Family Affairs is obvious – he knew what was coming down the tracks. I welcome the appointment of Deputy Coughlan and wish her every success, but she has been left holding the baby.

Bearing in mind that six out of every ten people living in relative income poverty live in a household headed by a person who is not on the labour force, the Government's increases in social welfare are unjust. In case Deputy Power has any doubt about this, I will illustrate with an example. A person came into my office on Monday, which is when I do most of my constituency work, and asked me what this budget would do for her. I did some research and was astonished at how little the budget would do for her. She is a lone parent with one child, who cannot work because she cannot afford child care. She had been receiving €118.80 plus €19.30 child allowance and €27.03 child benefit, a total of €165.13. Because of the budget measures she will be getting €124.80, €19.30 and €28.89, which adds up to €172.82. It appears that she and her child will be €7.84 better off per week, but that rise is completely negated by inflation. The cost of fuel allowance must also be added. This woman is in a local authority house: as a result of this meagre increase, her rent will now go up. Any increase is wiped out before it is even noticed. I had to tell her, and others who came into my office, that they would be no better off as a result of this budget.

The capping of the back to work allowance was only announced yesterday. Before this, a person who had been on social welfare for 15 months could qualify for a back to work scheme, which would enable them to retain 75% of their allowance the first year, 50% the second year and 25% the third year, plus their benefits. This was a great incentive for people on social welfare to get back into the workforce. When a person is unemployed or on social welfare for five years it is far more difficult to get back into the workforce than it is after 15 months. In the case of people on disability allowance, the period is three years. I may be wrong because I only read the press release. Even so, it is often the case that people on disability benefit are helped in their rehabilitation by getting back into the workforce. Now they are being denied that opportunity because of the provision announced yesterday.

Some of my colleagues referred to the fact that the Department of Social, Community and Family Affairs spent €19.5 million over the last two years on consultants and PR, which is a scandal. I raised the anomaly of the carer's allowance with the former Minister at every budget and now I raise it with the Minister for the first time. I hope she will take heed. A person in my constituency was receiving a carer's allowance for looking after a doubly incontinent, bed-ridden relative of her husband in her own home. Suddenly, her husband was killed by a tractor crossing the road. She then qualified for the widow's pension, but despite the fact that she continues to be a full-time carer she lost the carer's allowance. I will not ask the Minister to do anything else for me during the term of this Government if she eliminates the anomaly whereby a person loses his or her carer's allowance if he or she becomes a widow while continuing to be a carer. The only reason this person receives the widow's pension is to compensate her for the unfortunate loss of her husband. That woman must now employ help to run her small farm because of her full-time caring duties.

The country has come a long way since the days of the Famine, the poor law guardian system and so on. One of the Deputies made a comparison earlier with Ethiopia, which is a very poor place with a poor local economy and in every sense a Third World country, and which needs as much international support as can possibly be given.

Children do go to school in this country who are not fully fed and clothed, who have no family support systems and whose families are in despair. These people look to the social welfare system to give them support. This system, at a time of increasing economic difficulty, is not giving the support they need. This Government's policy is a failure. The meagre rises, welcome as they are, will be eaten up by inflation by the time of the next budget. The poor are the victims of this Government's lack of concern for the underprivileged in our society. On a personal level I welcome the Minister and wish her well, but the attitude of this Government is unacceptable in every respect.

The Deputy from Kildare spoke of child benefit being taxed. This is one of the benefits which apply directly and immediately to every mother in our society regardless of family income and this should be protected at all costs. There is never a case for the taxation of income which goes directly to the mother of a family. It is a sad reflection of our society that in many cases the breadwinner is male and that historically, women have been treated very badly. In cases of alcoholism and drug addiction, if the child benefit was taxed, the mother, who provides above and beyond what she is able to and lives on the edges of society, would suffer. The taxing of benefit, which would affect mothers who live on the edges of society, must be condemned outright. It is unacceptable that any Fianna Fáil Deputy would support or propose the taxation of child benefit. We must look after the badly-off. I have never seen an analysis that states that a family or society would be better off if child benefit were taxed. All politicians know that mothers really care and give most to their children, particularly when times are tough at home.

The Department of Social and Family Affairs is first class in its interaction with public representatives. I acknowledge the expert training and skill of those who staff the hotlines we ring. If the same training was available in local authorities and health boards, there would be significant improvement in community services. I cannot praise the response they offer highly enough. I am unaware, however, if there are 1890 numbers for the Department. I have not seen any in the telephone directories I have used. If there are such numbers, they should be widely circulated because people would call a low tariff number. We should make it known that there is a number to ring to ask questions of trained, professional staff. Those staff go beyond the call of duty to see if there is any way they can help the caller or if he or she is entitled to any other benefit.

There have been cutbacks in allowances for travel for social welfare officers. In County Louth people have applied for benefits only to be told no officer can come from the nearest administrative town to visit them in their homes and they must travel to the office. To assess someone properly the assessment should take place in his or her home. Cutbacks in travel allowances for social welfare officers should be reversed. To ask someone applying for invalidity benefit to travel from a rural area where transport is irregular is unacceptable. The Minister must ensure this practice is discontinued. The Department has a good name and this is part of the service it must give to the community. It should not be cut back.

The Money Advice and Budgeting Service, the St. Vincent de Paul and other community groups work extremely well together in Drogheda and I welcome the significant work they do. There should be statutory recognition of the MABS and its interaction with those who get into rent arrears. I have dealt with people who have rent arrears of €500 or so and, in many cases, they are too deeply in debt to feel they can cope with the issue. Someone with rent arrears to a local authority should be automatically referred to MABS. It is absolutely unacceptable that the local authority sends out eviction notices to people who cannot deal with their finances when MABS is capable of assisting. When this assistance is brought to the attention of the local authority, the results are very positive. People who fall into rent arrears often have other debts and it is an indication that a family might have serious income difficulties and may need someone to intervene on their behalf.

Interaction between the St. Vincent de Paul, the Department and social welfare officers is excellent. In Drogheda there is welcome recognition of the statutory and voluntary agencies. They work well together. With inflation and unemployment increasing and significant social problems emerging, we need more dynamic interaction between the Department and the community. That requires money and this budget fails in that respect.

Debate adjourned.
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