Dáil Éireann debate -
Wednesday, 8 Dec 2004

Vol. 594 No. 4

Social Welfare Bill 2004: Second Stage (Resumed).

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

Mr. McHugh

I wish to share time with Deputies Connolly, Boyle and Crowe. I am glad of the opportunity to speak on the Bill and, in doing so, will briefly refer to the budget as a whole. As an Opposition Member I may be expected to oppose. However I regard that approach to national policies to be too simplistic and a flag of convenience for a lazy Opposition. Credit should be given when it is due, as in the case of this budget.

The question is who deserves the credit. It is due to the people who voted in the last local and European elections and told the Government parties that the days of voting for the old order, irrespective of policies and of delivery of services, is gone. The people have indicated what they want the Government to do and are prepared to use the only method open to them — the ballot box — to get that message across. The budget provisions make it clear that the Government has received that message. The most heartening aspect of the budget is the provision for disability services.

The most heart-rending comment I heard when canvassing for the previous general election was the isolation and betrayal felt by people with disabilities and their guardians and carers. That feeling has festered and mushroomed for a long time under successive Governments. It is an indictment of the country that a Government that likes to present itself as caring would allow that situation continue for so long. It also crystallises the warped sense of priorities pursued in the name of the people by Governments over time. It is not necessary to declare oneself a socialist to have due regard for people who are less well off, to ensure that the weakest are protected and those regarded as having a weak voice are heard at the Cabinet table when decisions on the allocation of scarce resources are made. The people being deprived of their fair share in society are not interested in what label the Taoiseach or any Minister wishes to wear from one day to the next. Their only concern is that the people charged with running the country would treat everyone as equal and ensure that those who have most need are looked after.

The lack of attention to child care in this budget is regrettable. The cost of child care places a great burden on working parents and is so great that for many it has become unaffordable. This budget does not give the required prominence to the issue which is one the Government needs to address as a priority. Carers provide a vital service to society in a loving, humane manner and save the Exchequer millions of euro each year. The Government needs to recognise this vital work in a more determined way. This is an urgent matter. The budget provisions bestow some increased allowances for carers and additional carers are taken into account.

In the Taoiseach's pre-socialist days, the savage 16 social welfare cuts were introduced on the watch of the then presumably capitalist Taoiseach. I compliment the Minister for Social and Family Affairs, Deputy Brennan, on having brought about a relaxation of those measures which clearly indicates his commitment to those who are less well off. I also congratulate the Minister on his recent appointment. On balance, the social welfare measures he has succeeded in incorporating into the budget are welcome, and they will to varying degrees, help improve people's lot. The Minister has shown himself prepared to listen to various views, having consulted the different interest groups to establish their views, and although there are many issues to attend to, his first few weeks in the Department have been positive.

Mr. Connolly

In contrast to my rather caustic references to the Social Welfare Bill last year, I concede that this year's Bill represents a modicum of ground regained after the previous cutbacks and stealth cuts. The Social Welfare Bill normally gives effect to the social welfare changes announced in the budget statement, which are usually calculated to ease the pain of those most deprived socially.

How does it succeed in its task of bridging the poverty gap between the most disadvantaged and privileged in the community? One yardstick by which to measure the ongoing, cumulative effects of successive budgets on the lives of the poor, is the annual figures released by charitable and caring agencies such as the Society of St. Vincent de Paul. In the past three years, despite a booming economy, calls to the society have quadrupled, and it has been required to spend €600,000 each week to relieve poverty and social exclusion. Its spending of more than €31 million snuffs out the Celtic tiger's cough.

In far too many cases, those who felt it necessary to contact the Society of St. Vincent de Paul for help were not social welfare recipients but employees in lower-paid jobs. The Society of St. Vincent de Paul nowadays caters for people in low-paid jobs rather than the down-and-outs. Their low level of income renders them ineligible for any social welfare benefits. The back to school clothing and footwear allowance and medical cards are denied them. They are expected to shoulder the burden of a series of increases in the cost of living, since they qualify for nothing.

I am pleased with the increases in social welfare benefits, which have received a greater welcome this year than previously. The increases of approximately 9% are considerably ahead of the rate of inflation, which should, in normal circumstances, represent a real improvement in living standards. However, the circumstances of the low-paid workers had fallen so far behind in recent years owing to the absolute torrent of stealth taxes and price increases that they were constantly playing catch-up and never quite getting there. Several price increases are in the pipeline and will consume a major proportion of the 9% improvement in payments to social welfare recipients. Electricity, telephone and transport price rises and accident and emergency charges will all have to be met from the budget increases.

All those increases tend to leave the rate of inflation trailing far behind in their wake. Unfortunately, many people, especially at this time of year, are compelled to resort to the dubious services of money lenders. Money advice bureaux, or MABS, are most worthy of Government subvention, since they have traditionally performed a very valuable social service in providing positive advice to help rescue the most vulnerable from the clutches of money lenders. I welcomed the opening of a MABS office last week in Main Street, Castleblaney, which I attended. It is no longer seen as any shame to attend their offices for advice. People fall into poverty traps, and I encourage them to use the MABS, which provides a fantastic service.

Last year we all bemoaned what have become known as the "savage 16" social welfare cuts that hit the weakest in society. I am happy to acknowledge that the Minister's modifications represent a slight row-back on nine of those cuts. It took courage, and it is a step in the right direction. The three-month reduction, from 15 months to 12, in qualifying periods certainly does not amount to a rescinding and barely eases the burden that families are required to carry. The main thrust of the cutbacks remains — the real cuts in relief schemes for the vulnerable. I would dearly love to be able to congratulate the Minister on removing them altogether. It was in the wake of last year's budget that most of those cuts were introduced, and there is no reason in the next few months, further adjustments could not be made to them. It happened last year, and I would certainly like to see it happen again.

I welcome the respite grant increase, which will improve the position of almost 10,000 carers. A conservative estimate of carers' numbers is approximately 145,000, most of whom will not receive a penny from this year's budget provisions. I also welcome the removal of those on the minimum wage from the income tax net. Unfortunately, in 2005, when the next Sustaining Progress increase kicks in, they will swim right back into it. The income tax take continues to increase each year, showing that people moving out of and back into the tax net is a cosmetic exercise. Unemployment benefit has gone up by €14 per week, something that I also welcome. As Father Seán Healy has pointed out, there would have to be a crescendo of further increases in the next two years of €17 or €20 weekly to meet anti-poverty norms. It is also significant that it is the first time that Father Healy has acknowledged or welcomed a budget.

For many parents with child care costs of more than €200 per week, there is no incentive for one partner to work. The budget has made some progress in giving such people a helping hand, and the Minister deserves some plaudits. However, I remind him that there is considerably more to do in the next two budgets if he is to aspire to the lofty aims contained in the joint programme for Government.

Mr. Boyle

Before the Government drowns in a sea of self-congratulation, we must put this budget in the context of the preceding seven. The Combat Poverty Agency has conducted an analysis of all eight budgets, showing that the first five introduced by this Government were unashamedly in favour of the better-off in society. The sixth was neutral, and the seventh only marginally favoured the less well-off. The eighth budget introduced by this Government begins at last to claw back some of the damage caused by the Government when it comes to meeting the needs of the less well-off in society. The levels of increase only go so far towards meeting the commitments the Government entered into in Sustaining Progress. While welcome, the €14 increase in the lowest rates of social welfare benefit will necessitate the Government indulging in similar increases in the next two budgets to meet its commitment of giving social welfare recipients levels of income that are 30% of the average industrial wage, or 50% of average household incomes. Currently, the lowest and most common level of social welfare benefit is €148.80 per week, or IR£115 in old money. For one third of our population, that is what they must live on each week.

There is therefore no smugness or sense of complacency to draw from these figures. The Government must catch up after the previous seven years in which it increased the distance for those people to reach even the average of most citizens today. We need a more honest debate about what social welfare is and what it is achieving for many citizens. The smoke and mirrors exercise in which the Government engaged is really frightening, and while the Minister himself is a somewhat late convert to the idea of social justice, we can only wish him well and accept what he says about his intentions.

However, even in counteracting the damage done — the effects of the savage 16 cuts of November 2000 — an analysis would show that the Government is still being dishonest with those who depend on social welfare payments. There has been one full row-back on foot of a wide-ranging public campaign after the rightful opprobrium attached to the cut in the half-rate payment for widows. The Government entered into that commitment well before the budgetary process. If we go through the remaining 15 cuts, we see that many have not been changed at all, some are being amended slightly, and none has been restored to how it was before November 2003. That indicates the Government's real commitment.

Let us take a few examples. There was a six-month qualifying factor for the back to education allowance. In November 2003, the Government changed that to 15 months. Now it is going back to 12 months, which is hardly much of a change. The transitional half-rate payment for lone parents was discontinued where earnings are in excess of €293 per week. In 2005, this measure is to be amended whereby recipients will receive the transitional half-rate payment for six months.

In 2004, there was an increase in the threshold of the contribution recipients of supplementary rent allowance are expected to pay, in respect of which there has been no change. Supplementary welfare allowance is not payable to people in full-time employment. If one of a couple is in full-time employment, both are excluded form claiming rent or mortgage supplement. This measure has been referred to the social partners, but no change is proposed to it.

The Government has partially recognised a group of people on the minimum income level in the budgetary process by removing them from the tax net. They constitute a new poor in our society, given the level of payment they receive and their outgoings in terms of cost of living plus an addition in terms of low levels of taxation, which undermines their basic level of pay. One need only reflect on the highest proportion in terms of what they contribute to the Exchequer as against those who have far higher incomes. We know from Revenue figures that people with an income in excess of €1 million avoid paying tax because of the existence of tax reliefs. The Government has missed an opportunity in this legislation to be creative and institute real reform. The increase in allowances coupled with removing wage earners from the tax net could have provided an opportunity to marry the social welfare and taxation systems.

The Green Party has talked about the introduction of refundable tax credits, which would mean that those on the lowest income who receive a tax credit and do not take full advantage of it should be paid directly the amount of which they are not making use. Such tax credits would be easy to administer, particularly given that the alternative in terms of the Government's social welfare policy is the family income supplement. The Government has made great play of saying that its initiative in respect of family income supplement will introduce an extra 14,000 people into this net. However, that is nonsense. At present, barely 12,500 receive family income supplement. That number represents only 30% of those who are entitled to receive family income supplement. In reality, more than 40,000 should be receiving it. However, those people choose not to because of the existence of the bureaucracy that surrounds that payment and the social stigma attached to it. If the Government was to be more creative, it could introduce a new system of refundable tax credits that could address a worker's pay and entitlement at source and subsequently change what needs to be done in terms of tax payments.

I will return to what the Government has not done to address the savage 16 pay cuts. The MABS supplement is not to be restored in its previous form. Additional money is to be given to the money advice and budgeting service, but as of yet we do not know how that money will be used or whether the proposed allocation is sufficient to meet existing needs.

I am glad the Minister has joined us. The real gap in the legislation is in regard to provision for children, but I am not sure if it is one the Minister is prepared to close in the second Social Welfare Bill that we will discuss in the new year. We have a constitutional commitment to treat all children equally. The Government entered into specific commitments to child benefit payments, namely, that a payment rate was meant to be reached as of last year. That rate will not be reached this year. There is a vague promise that it might be reached next year. Taking account of the range of payments for supports for children, this is a disappointing budget and Bill. Child development allowances remain frozen for the 11th year in succession. The crèche supplement seems to have been brought in by a surreptitious back door method where the avenues open to people are more limited than they were in the past. People seem to have to jump through higher hoops to justify receiving a payment which, in the past, was necessary for lone parent mothers on low incomes to help them get into the workforce. If the Minister examines this area, he must accept that the Government has a great deal of work to do to make up its commitment to child care provision.

I wish to refer to disability benefit payments for which the Minister has only partial responsibility. While this area represents this year's decentralisation in terms of the Minister for Finance's Department, the Minister for Social, Community and Family Affairs needs to acknowledge that there are several areas in respect of which the Government has failed to say anything and failed to meet the needs of many involved in the disability movement. There has been no cost of disability payment or move towards a full-time care assistant programme which the Centre for Independent Living has requested. Having regard to the recommendations of the 1994 report of the Commission on the Status of People with Disabilities, there are many recommendations that have yet to be addressed, acted upon and given the necessary resources. Therefore, the Government must fail to take pride in that despite much of the resources that have been provided and promised over the next few years that there is much more to do in this area.

Mr. Crowe

I will start by saying what a difference a day makes, not only budget day on 1 December, but election day on 11 June. As the Taoiseach admitted while the count wore on, Fianna Fáil lost seats right across the Twenty-six Counties and the party suffered its worst results since the 1920s — many of the political pundits talked in terms of Fianna Fáil having lost the election and Sinn Féin having won it.

Since then, Fianna Fáil has embarked on a major soul-searching or PR exercise, depending on one's point of view, to rebrand itself and persuade people that the past seven years of budgets were an aberration and that the normal post-Inchydoney service can be resumed. The former Minister, Charlie McCreevy, has been sacrificed on the altar of political expediency and some of the more "let the market sort it out" Ministers have also been moved. However, while it might be a public relations exercise, it is one that has benefited in real and significant terms hundreds of thousands of people across the country. Their reward, it appears, for voting out Fianna Fáil councillors and MEPs was increased welfare support for them and their families.

I welcome many aspects of the budget. Although it is not the U-turn I sought, it is certainly a step in the right direction. I draw attention to the increase in the minimum rate of unemployment assistance by €14 per week. It is substantially in excess of inflation and is welcome, if much belated, recognition by the Government that job creation alone is not the means to end poverty. The increase announced by the Minister will bring the minimum rate to €148.80. The Government committed itself under NAPS and again in Sustaining Progress to achieving a target of €150 a week by 2007. In his statement on 1 December, the Minister said the Government was on target to achieve this figure, but what exactly is the target? CORI estimates that by 2007 the equivalent of the 2002 figure of €150 will be €185.80, 30% of average industrial earnings. Is the definition of the target accepted by the Minister? If so, can we expect even larger increases in minimum employment assistance in the next two budget to close the gap?

I would appreciate if the Minister would clarify exactly what figure we are talking about, by what formula he develops this figure and what constitutes the rate of €150 per week in 2002 terms for 2007? The worry is that rather than adjusting for inflation or for increased average earnings in this State, the figure of €150, unadjusted in any way, will be the projected target for 2007.

The increases in child benefit to €141.60 will leave the Government well short of its target of €150 by 2005. It is worth reminding the House that this target for 2005 was only set when the Government broke its pledge to achieve that target by 2003. The figure of €150 for the lowest rate of child benefit has been twice promised and twice broken. Will there be an adjustment during this year? This limited increase in child benefit pales next to the Government's blanket refusal since 1994 to increase the child dependant allowance. The value of this allowance was reduced by approximately 30% in the ten years the Government refused to increase it. The explanation given by the Minister's predecessor for not increasing an allowance specifically targeted at alleviating the suffering of the children of some of the poorest households in Ireland was that any increases would be a disincentive to employment. Is this still the position of the Government and of the Minister opposite? If so, will he explain to the House how increases in unemployment assistance are not a disincentive to work while increases in the child dependant allowance are?

Since this Government came to power in 1997 it has set about widening the gap between rich and poor with a determination and a commitment that would be inspiring to see if it was directed towards ending means-testing in respect of the carer's allowance or eliminating child poverty. This budget, described as a give-away budget by the media, continues the well-worn path of deepening and sustaining inequalities. As outlined by the new favourite Government economics analyst, Fr. Seán Healy:

Budget 2005 has widened the rich-poor gap by €30.93 per week. The disposable income of single people who are long-term unemployed and those on €50,000 a year has widened by €16.93 a week (€883 a year) . . . The impact of this Budget on the take-home income of couples has been almost as striking. Couples who are long-term unemployed are €23.30 a week better off while a couple on €50,000 are €40.17 a week (i.e. €2,096 a year) better off ... The cumulative impact of the last seven budgets by this Government (since 1997) is to have widened the rich/poor gap by €310.93 a week (€16,224 a year).

In his press statement of 1 December, the Minister said that closing the gap between those on lower incomes and those on higher incomes was a priority. Since this budget has widened that gap by €30.93 a week it is difficult to see how the Government's actions could be considered prioritisation.

As a republican party Sinn Féin is committed to radical reform of our taxation system. The Government has made much of its reductions in tax payments over recent budgets but has ignored the reality that a slew of indirect taxes is damaging working families. Between stealth taxes and indirect taxes, the Government has caused 60% of the increase in the consumer price index in the past three years.

I want to deal with one of those taxes in particular because of the fury it has aroused particularly in this city. According to a Combat Poverty Agency report published in November 2003, "Waste collection charges exclusively based on the ‘polluter pays' principle are inevitably regressive, posing a major burden for low-income households, especially those with children and other dependants." Between 1997 and 2003 waste collection charges grew by 223% over six years, far in excess of the rate of inflation. We have also seen increases in excess of 70% in the Dublin City area and 20% in Fingal.

According to recent research from Trinity College 25% of patients with a specific medical problem do not attend a doctor for reasons of cost. The figure rises to 40% in the 20 to 29 age group. Increased charges in respect of rent, ESB, bus fares, food, medicines, license fees, hospital charges, all hit the worst off in our society hardest and the Government increases spending and claims there is no more money to increase it any further for the less well off. Some claim there is no alternative to the low-tax, low-spend, devil take the disadvantaged, laissez-faire system of economics in Ireland. It is this point that needs to be driven home and has been ignored in the coverage of this budget. There is an increase of almost 9% in social welfare expenditure. It is the largest amount ever spent on social welfare in the history of the State. I genuinely welcome that. However, we are now a richer society, one of the richest in Europe. We have new millionaires every day. Alongside that, we have increasingly more people living on credit and getting more and more into debt.

I accept at face value what the Minister says. He met 30 lobby groups and made a commitment to roll up his sleeves and fight on behalf of the less well-off people in society. I welcome that. The Minister has a difficult job ahead of him. There is much to be done. Clearly the Minister has started to go in the right direction. We support certain changes that help the less well-off. Some of the measures in this budget certainly do that, but there is a weakness in the budget in the area of social housing, and people on social welfare are caught in a trap regarding accommodation. The Minister and others in the House know that.

Mr. Finneran

I propose to share my time with Deputy Wallace. I welcome the Minister to the House. I compliment him on his involvement in the budget.

Fianna Fáil, the republican party, is committed to the needs of pensioners and has implemented the largest series of pensions increases in our history. It believes in delivering good pensions today and making sure they can still be afforded when today's workers retire. It is giving a clear commitment to achieving a basic social welfare pension of at least €200 per week by 2007. It is committed to protecting the National Pension Reserve Fund that it established to provide for long-term pension needs. When this Bill is enacted, the old age contributory pension will have been raised by more than 80% since 1997, and the old age non-contributory pension will be up by 93% as a result of the provisions of budget 2005 and this Bill.

At the same time the Government has made major improvements in the area of non-cash benefits such as free telephone rental and electricity allowances, which are an important element of the support we provide for older people. By establishing the national pensions reserve fund, the Government has made sure that Ireland will be able to keep paying decent pensions even when the population ages significantly. It will continue to increase pensions ahead of the cost of living and ensure that pensioners keep up with the general income levels in the economy.

The Government is committed to the continuing development of our pensions system to ensure that people can enjoy a happy and secure retirement. We have fewer older people on pensions than the rest of the EU. This is one of the reasons our level of social spending makes up a smaller proportion of our national income. However, Ireland could easily face the same problems as the EU. Our baby boom generation will reach retirement age in the 2030s and 2040s. This may well be combined with increases in life expectancy and a declining birth rate.

Currently public service and social welfare pensions cost the Exchequer approximately 5% of GNP. Maintaining the present level of provision is expected to cost approximately 8% of GNP in 2026 and approximately 12.5% of GNP in 2056. There will, therefore, be a significant rise in the cost of pensions borne by the economy towards the middle of the century.

A recent study of population projections published by the Minister for Social and Family Affairs showed that in 2001 there were approximately 430,000 people of pension age in Ireland and that this is estimated to rise to 673,000 in 2021 and to 1.2 million in 2056. At the end of May 2004, there were 202,710 people receiving an old age contributory or retirement pension and 85,877 receiving an old age non-contributory pension. An actuarial review of the social insurance fund projected that the number of recipients of old age contributory and retirement pensions will increase to 255,000 by 2011 and 321,000 by 2016.

The increase will to some extent be balanced by a reduction in the number of people receiving an old age non-contributory pension. The numbers receiving this pension have declined by more than 20% in the past ten years which reflects the improved social insurance cover and increased labour force participation, particularly among women.

The decline in the birth rate is relatively recent and this, coupled with the effects of high emigration for much of the period up to the 1990s, has resulted in Ireland having the lowest proportion of older people in the EU with 11.2% aged 65 and over compared with the current EU average of 16.1%. Ageing, therefore, presents the same challenge to Ireland in meeting growing pension costs as to other countries except that we have a longer period to prepare for its full impact. The population projections suggest that no special measures are immediately required. However, the Government is making preparations through the national pensions reserve fund to part-fund State pension costs from 2025.

Pensions have been an important issue at EU level in recent years, which is not surprising given that challenges facing pension systems are more immediate for other member states. The EU has assessed national pension systems under the agreed objectives of adequacy, financial sustainability and modernisation. In this regard, a joint European Commission and Council report published in 2003 considered that Ireland had made good progress in ensuring financial sustainability and adequacy of its pensions system. The report concluded our system appears to be, in broad terms, financially sustainable despite projected major increases in future pensions expenditure. This situation will be kept under review by the Minister, Deputy Brennan, and the Government.

In April 2001 the Government established the national pensions reserve fund as a mechanism to ease the increased pension costs which the Exchequer will face. The fund involves setting aside funds, investing them and drawing them down in future when growth rates may be slower and the dependency burden increased. The fund will ease the Exchequer burden arising from our additional pension commitments to avoid sudden rises over short periods and to reduce this burden to a significantly lower level than it would otherwise be. The Government is committed by legislation to making a statutory payment of 1% of gross national product to the fund each year, which was €1.1 billion in 2003. In addition, the Government kick-started the fund by allocating €6.5 billion to it on its establishment. Already, some €10.5 billion has been set aside for long-term pension and social welfare costs by investment in the fund, which is growing.

The fund was a new departure in the management of the public finances and introduces a new strategic, long-term element into budgetary planning. Its establishment shows that the Government recognises the importance of the pensions issue and has put in place a practical mechanism to deal with it. This is a remarkable provision for a Government that is forever being accused of only having its eye on the next election.

I recently attended a meeting in London at which pensions were discussed. Ireland was lauded by all states represented for its initiative in setting aside 1% of GNP for the national pensions reserve fund. It was stated that we were the first EU country to do so.

Mr. Stanton

Will the Deputy give way? I have a question on this issue.

Mr. Finneran

I am almost finished my contribution. The short-term attitude comes from those who want us to use the 1% of GNP being set aside for future pensions to fund badly-needed infrastructure projects now. I say to them that the key to our stewardship of the Government finances is that we are delivering both major increases in infrastructure spending and provision for pensions. I reject the idea that the fund should be raided every time there is a new project because this is the surest way of undermining our finances in the future. Short-term policies like this were exactly what got us into so much trouble in the 1980s when the politics of spend today and worry tomorrow caused mass unemployment and emigration.

Mr. Stanton

What of 1977?

Mr. Finneran

The Government is investing 5% of GNP in infrastructure, twice the European average. This is a sensible level of expenditure because to borrow or spend more could risk inflationary pressures and put undue stress on capacity. The people can be sure that with Fianna Fáil in office, pensioners will be looked after today and in the future.

Mr. D. Wallace

I congratulate the Minister, Deputy Brennan, on bringing forward his first Social Welfare Bill, which was welcomed throughout the community. I look forward to the two further Social Welfare Bills he will bring before the House in the coming years.

Last week's budget was important for many in the State across all sectors of life and the changes outlined in taxation measures will benefit many. However, those who have most to gain from this innovative budget are those dependent on the State for income because a substantial increase in the rates of welfare entitlements will improve the quality of life for the most vulnerable in society.

It is important to acknowledge that the reason we have so much scope to offer meaningful and telling increases in rates of payment is because of the strong performance of the economy. Commitments were made by the Government that the gains made by the State would be redistributed to ensure that all sectors of the community would benefit from the growing prosperity of our country. It is easy to take these increases for granted and be dismissive of them, as some Opposition Members have been. However, 1.5 million people will benefit directly from these entitlements weekly. They cater for those in a variety of different circumstances, and adults, children, pensioners, the unemployed and people with disabilities, both temporary and long-term, will all receive increased payments. However, the most important aspect of the recent announcement is that the average increase is over 8%, which far exceeds the rate of inflation.

As legislators, we have all been lobbied by the many and various organisations which work to alleviate hardship among the less well off in society. The increases in the past six budgets are an acknowledgement of the role of these organisations in articulating the needs of their clients and ensuring ongoing improvements in the rates of payment to ensure the continuation of the aim of working towards narrowing the gap between rich and poor in society.

When we consider the specifics, we can see the impact of the changes. I particularly welcome the increase of €12 per week to pensions, resulting in new rates of between €166 and €179 per week for pensioners. It is vital that we, as a society, continue to acknowledge the role played by our elderly citizens in building our society. When times were difficult and when we did not enjoy the prosperity that now exists, the foundations for this prosperity were laid by those who are now elderly working throughout the country in a variety of different sectors. They are entitled to everything they receive and it is only fitting that we should continue to work towards the commitment to raise their pensions to €200 per week before the end of the Government's period in office. I am glad we are on target to do so and that this commitment was made last week by the Minister for Finance, Deputy Cowen, and also by the Minister for Social and Family Affairs, Deputy Brennan.

Another sector of our community that continues to do Trojan work and is equally deserving of significant improvement in recognition of their contribution is carers. I am pleased that the budget recognises the important role of carers in our society. In particular, that it extends the availability of the respite care grant and increases it to €1,000 is an acknowledgement of this outstanding contribution.

In homes throughout the country, people care for family members, the elderly and people with disabilities in a compassionate way. They do so in a way the State could never hope to match and they need our support for the difficult yet worthwhile work which benefits society. The extension of the respite grant is a beginning in acknowledging this work and I welcome that the Minister intends to carry out an in-house review of the carer's payment in an effort to further improve the situation. This is a priority of the Joint Committee on Social and Family Affairs, of which I am a member.

Undoubtedly, the aspect of the budget which received widespread approval and was long awaited was the commitment to improve services for people with disabilities. Obviously, many of those improvements within the €900 million package over the next couple of years will be interlinked with social welfare measures to improve the situation for people with disabilities. I am aware that the Minister is very conscious of his responsibility in this area and I know that whatever changes are required to ensure a more equitable system will be introduced.

One of the key supports offered to people on social welfare is the rent supplement which is payable under the supplementary welfare scheme. This area has received much comment in recent months. I agree with the Minister that the solution for many people is long-term social housing and every encouragement needs to be given to ensure people, who are currently on rent supplement on a long-term basis, can access social housing through local authorities. However, it is fair to say that hardship was experienced by people because of the six month rule. I welcome the fact that the Minister has acknowledged that some changes are needed in this area and has agreed to address that point.

One area which had been creating much anxiety among social welfare recipients in recent months was that SSIA savings would impact on the value of pensions. I am pleased the Minister has agreed to increase the means test disregard in respect of savings from €12,694 to €20,000. This is a significant measure as it means people can now continue to save and avail of the full maturity value of their SSIA without being concerned about the impact on their benefits. This measure will provide peace of mind for people who have had the foresight to commit resources to savings to ensure they have a nest egg to cater for future eventualities. It would have been very unfair to have penalised people for making an effort to save money from their own limited resources and I am glad the Minister has acknowledged this fact and expanded the threshold.

In regard to the family income supplement, I appeal to the Minister to give more attention to making people aware of their entitlement. I congratulate the Department which is excellent in regard to making people aware of their entitlements. However, this is one area which has caused concern. There are many people who could avail of family income supplement if they were made aware of it, so I make a special appeal to the Minister in this regard.

This is a particularly good budget for people on social welfare because it acknowledges the importance of providing regular increases in benefit for people who are dependent on the State for their income. In any budget, there are competing demands for resources and different sectors of the community have different priorities. Those who will always have a great claim on support are those who are most vulnerable in our society and I am glad that in this budget the Government has acknowledged the claim of those people and responded to their needs by providing real and telling increases. There is no doubt that these measures will make a significant impact on poverty and will directly benefit the lives of many people. I am pleased to support them. There are many other aspects of the Social Welfare Bill to which I would like to refer but time constraints do not allow me to do so. Again, I congratulate the Minister.

Mr. Ring

I am delighted to speak on the Social Welfare Bill. I am glad the people spoke very loudly at the June local elections when they said to Fianna Fáil and the Progressive Democrats that they had done a job on the poor and looked after the rich. What was done in this budget was a response to the local elections. There were generous increases in social welfare. Why would there not be since last year when there was a threat of a downturn in the economy, the first people to be targeted were the weak and the poor? When the previous Minister needed to save money, we saw the savage 16 cuts. The people were sick and tired of the super rich having tax breaks and the poor being crucified on a weekly basis by stealth taxes. The people spoke at the local elections and the Minister responded.

A promise was made by the previous Minister for Finance, Mr. McCreevy, in 2003 to the women of this country. He told them that over a three year period, there would be major increases in child benefit. Even with the increases this year, that promise has not been honoured by the Government. I know the Minister for Finance said in his budget speech that next year and the one after, he would look at it. However, when one makes a promise, it should be honoured. That is one promise which has been broken.

I was pleased to see the €14 increase in social welfare because people living on social welfare were experiencing difficulties. In the past year, the Society of St. Vincent de Paul and other charitable organisations and health boards have seen many people looking for help and support. For the first time in many years, they found that people were finding it more difficult to live on social welfare payments. It was the first time in many years that both the Society of St. Vincent de Paul and health boards were put under pressure as people were not able to live on what they were getting simply because of stealth taxes.

I do not know how inflation is calculated, but the people who do so are a bit like the spin doctors in Fianna Fáil in that they can spin it out. I suspect they get a basket, put 100 items into it, including three holidays per year and two cars per household, and then calculate inflation. Listening to people who shop on a regular basis, there is no doubt that food and other costs show rip-off Ireland at its best. We were told the greatest thing to happen to this country was electricity regulation and we appointed a regulator, yet on three different occasions last year, the ESB got an increase which affected the poor.

I want the Minister to write to county councils to tell them they can only take a percentage of the increases he has given people. There is no point in the Minister giving people a €14 increase if the county councils take €7 or €8 from them. That defeats the purpose of the increase. I ask the Minister to ensure people are protected against that.

There was spin in the past few weeks about medical cards. I welcome the change because it is the one issue I have raised continually in my constituency and in this House. There is no point giving people an increase of €14 in social welfare if the social welfare officer tells them they are over the income limit. Such people must be protected.

There are three rates of child dependant allowance. While I know the Minister is only new in the job, previous Ministers in the past ten years have failed in regard to the three rates. All children are equal and there should not be three different rates of €21.60, €19.30 and €16.80. None of these rates has changed in the past ten years, yet every report from the State agencies on poverty states that the best way to tackle poverty is to give money by way of the child benefit or the child dependant allowance because it is targeted at children, is given to the mother and is spent on the family. This matter should be addressed.

This year I thought the €16.80 rate would have been increased to €19.30 and that next year, all the rates would be the same following an increase. The rates have not increased in ten years which is wrong and should be addressed. When the Minister is undertaking a review in his Department, I ask him to look at those rates. I know the Department will find excuses as to why it should not be done. It is wrong that there are three rates and that we discriminate against families and children.

An issue I have raised every year which most aggravates people who pay their dues, PRSI and stamps and who are on short-term payments is their failure to get the Christmas bonus.

If a man or a woman works seasonally, for nine or ten months of the year, he or she will not receive a Christmas bonus even though he or she contributes to the social insurance fund. The long-term unemployed get the bonus, however. I have sought that bonus for seasonal workers for a long time. If some people are on short-term or seasonal work, through no fault of their own, it is wrong and mean not to qualify them for the Christmas bonus. The Minister should examine the matter, particularly as the social insurance fund is currently in credit. There has never been as much money in the fund as there is now. It is the people's money; they have contributed to it so we should look after them by giving them the Christmas bonus.

I am delighted the Government has given a commitment to increase the old age pension. Those who preceded us helped to establish this State. They worked in difficult times on low incomes and did their best to raise their families. They expect to be looked after when they reach pensionable age. We will be judged on how we looked after the elderly because we will be expecting the younger generation to look after us in time. If we do not care for the elderly who made major sacrifices for this State, how can we expect younger people to look after us in years to come?

I was delighted the Minister gave pensioners an extra €12 but I was disappointed they did not receive €14, as others did. Why did the Minister keep back €2 from the pensioners while other payments were increased by €14? There should have been an increase of €14 across the board and I am disappointed that did not happen. Pensioners were delighted with the increase but they are confused because others got a €14 rise.

I have listened to the Government's spin on the amount of money paid out in pensions. A great deal of money is paid out in pensions but when I tabled a question on this matter in September I was amazed to discover that €170 million in State pensions is being paid to people outside the country. These people are entitled to every penny of it because they have paid their contributions to the State over the years. Spin doctors have been spelling out how much is spent on social welfare but €170 million must be deducted from that because it is going abroad.

On the other hand, returned emigrants are treated in the meanest fashion by the social welfare system. People who have worked abroad may be on a contributory pension from England or America when they retire here. If they do not have a full pension, they may apply to the Department of Social and Family Affairs for the remainder. However, the way their sterling pension exchange rate is calculated is outrageous. It is a great deal less than one would obtain from a bank, so the Minister should examine the matter. The system of calculation aggravates people who have worked abroad, many of whom left Ireland when there was no work for them here. They were forced to leave the country and make a living overseas. Having returned home, they may now have three-quarters of a pension and will depend on the State to make up the remainder. However, when social welfare officials examine the situation they calculate the sterling-euro exchange rate in favour of the State, not the pensioner.

Although the euro has been a strong currency in recent times, when sterling was weak the Government did not throw money at returned emigrants living on British pensions. The current method of calculating the pension top-up upsets people who worked abroad and now live on foreign pensions. It is wrong to penalise them in this way.

I want the Minister to clarify the situation regarding the respite grant for carers. I was glad to see the €14 increase for carers but while there are approximately 170,000 carers, only 22,000 receive the allowance. Some 19,000 get the full allowance, 3,000 get a partial payment and the remainder do not receive anything. In his reply, the Minister might explain what he means by the respite grant. Those in receipt of a full or partial carer's allowance will get a respite grant. However, the Minister says that a further 9,000 will get a respite grant. Does that apply where the State says a person is in need of full-time care but because of means will not receive any payment from the Government? In what way does it work? This is a difficult issue to handle. For example, how do people know if they are eligible for a respite grant? They may not have made an application because they thought their spouse's income would put them over the eligibility threshold. How will they be assessed? Will there be a special application process for such people who are looking after their loved ones? How will the Minister proceed in this regard? He may respond to this point when he is winding up the debate because I am interested to see how the system will work. I am glad, however, that some carers will get the respite grant because, at least, it is a step towards recognising the excellent job they do.

Carers are the forgotten people. They look after their loved ones but receive no financial help despite saving the State a fortune. The matter has not yet been sorted out, although the Tánaiste and Minister for Health and Children is talking about bringing the necessary legislation before the House. I hope the elderly will be protected. Under no circumstances should any legislation come before the House that would prevent that from happening. It is clear that if a person is in need of full-time care and has a medical card, the State is legally obliged to look after him or her. I do not want to see any change in that situation.

There is a change of attitude in the country. People have told me that when their loved ones go into a hospital or nursing home the first thing they are asked to fill out is a subvention form. That is putting pressure on the elderly. Some people accept treatment or have their loved ones treated in the private sector but others feel they are being forced into it. Such pressure is wrong and should be resisted. I hope no party in the House — I include the Fianna Fáil backbenchers in this — will allow a Bill to come before us that does not protect the elderly. It would be a sad situation if that happened.

Previous speakers have referred to those on low incomes who avail of the family income supplement. Over the years, Fine Gael has asked for this supplement to be dealt with through the taxation code. If somebody is entitled to the FIS they should be notified by the Revenue Commissioners, rather than having to apply for it through the social welfare system. In that way, such people would receive a top-up to increase their income to the requisite level. The problem, however, is that many people do not know about the family income supplement. In addition, they are embarrassed to seek it because they feel that since they are working they do not want to be in receipt of a social welfare payment.

Deputy Dennehy should not smile at my remarks because that is the way it is. People have pride and independence when they are working so they do not want to receive a social welfare payment. Those on low incomes should at least be told that the FIS is available. The Department of Social and Family Affairs has failed to sell the family income supplement to those who are eligible for it. The record shows that the FIS should be taken up by thousands more people but is not, because they are unaware of it or do not fully understand their entitlements. Obviously, they have not received the necessary information about the family income supplement.

I am glad the Minister has reconsidered the so-called savage 16 welfare cuts. I have repeatedly raised the issue of the restrictions in the back to education scheme. Deputy Stanton observed earlier that the objective of this scheme was to assist people in escaping the social welfare trap and attaining a better future through education. Under last year's cuts, the timeframe for this scheme was changed from six to 15 months. The Minister has brought it back to 12 months but that is not enough. There should be no restriction in accessing this scheme. It is unacceptable that there should be obstacles in the way of a person on social welfare for five or six months who wishes to improve his or her situation through education.

This scheme is of benefit to the State. A person who secures an education and subsequently a job will contribute to the State. Will the Minister reconsider this issue? He might take the opportunity on Committee Stage to reset the provisions of the scheme to include a timeframe of six rather than 12 months. The latter is not reasonable because it allows people to get into a rut. A report published many years ago confirmed the benefits of allowing social welfare recipients to return to education as quickly as possible. This is something the Minister must consider. The increase from six to 12 months has a significant negative impact.

The change to the rent supplement scheme was another of the savage 16 cuts that caused many difficulties. I am glad this cutback has been revoked and am interested to learn the new guidelines for its implementation. I also welcome the Minister's decision in regard to the crèche supplement, an issue I have raised on many occasions. The Bill proves that the Minister has done well in his negotiations with the Minister for Finance. I welcome that he targeted resources at those who needed them most. However, these provisions represent only the beginning of what is required. They relate to the welfare of people who have fallen behind over recent years.

There is one other group I must mention on pain of reprimand from my mother. Upon assuming his new departmental responsibilities, the Minister stated that his priority was the welfare of widows. However, the latter continue to be the forgotten people in this State and have been let down once again in the budget. The Minister must do something to improve the welfare of widows who constitute the one section of society that has been neglected in successive budgets. I have seen the hardship experienced by widows, young women especially, who have lost the entire household income. Widows should be entitled to avail of free schemes, including those relating to travel, telephone and rent.

The priority for next year's budget must be the extension of all such free schemes to widows, regardless of age. I was looking forward to such a provision in this year's budget but was disappointed in my expectation that the Minister would be the first to look after the welfare of widows. I am depending on him to do so next year. I do not want the widows of Ireland to put a curse on the Minister.

Mr. Dennehy

I propose to share time with Deputy O'Connor.

Acting Chairman (Mr. McCormack)

Is that agreed? Agreed.

Mr. Dennehy

Like all previous speakers, I am glad of the opportunity to speak on this Bill. I compliment the Minister and wish him well. Before the budget, there was speculation in the media and elsewhere that he might not have sufficient knowledge and commitment to tackle social welfare issues. It is obvious that people misread the Minister. He has held a number of portfolios and there was a lack of awareness of his commitment to the less well-off.

Mr. Stanton

The Minister has undergone a conversion in this regard.

Mr. Dennehy

I am glad the Minister has proved all such commentators wrong.

I wish to make a number of observations on the contributions of other Members. In previous years at budget time, there have been references to Budget Choices, the policy briefing document from CORI which outlines its analysis of the current year's budget. It is notable that this document has not been produced this year. Every critical comment regarding the budget has referred to the observations of the Society of St. Vincent de Paul. One wonders why there has been no mention of the comments of CORI that this has been a good budget.

Mr. Stanton

There have been too many other issues to discuss.

Mr. Dennehy

Hypocrisy may not be the correct word to use in this case but such responses indicate a lack of consistency. For the past four years, Opposition Members have pointed to the annual reports from CORI and highlighted various sections. I am delighted with this budget, as I am sure are almost all Members. I have already observed that the shutters were pulled down on last Wednesday's budget debate at 8 p.m. This is an unprecedented and welcome development.

Deputy Boyle quoted from the Combat Poverty Agency's report this year rather than that of CORI which he has been used to reference. I am unsure as to what such terms as "smugness" and "smoke and mirrors" refer but this type of parliamentary language does nothing to facilitate a discussion of the difficulties experienced by people. I am unhappy with Deputy Boyle's contribution in this regard.

An issue referred to by Deputy Ring was also raised by Deputy Rabbitte, the leader of the Labour party, yesterday. This is the issue of pensions for people who made contributions prior to 1953 and who had to leave Ireland, an issue with which I have been involved for many years. I am annoyed by the comments of Deputies Ring and Rabbitte because for years there was a refusal by any Minister to accept that such people should be in receipt of benefits. They were not entitled to such as an automatic right, as claimed by Deputy Rabbitte yesterday.

This raises questions as to the consistency and sincerity of he Opposition. Both Fine Gael and Labour Deputies have complained and wept crocodile tears in this Chamber for those people abroad. However, in the past six months, these same Members have questioned in the Committee of Public Accounts the amount of money spent on such benefits. Deputy Ring has given slightly inaccurate figures in this matter. The sum for 2004 is not €170 million but €130.2 million.

Mr. Ring

On a point of order, I obtained that figure from the Department. Is the Department in error?

Acting Chairman

Deputy Ring is entitled to ask Deputy Dennehy to give way on this point. However, if the latter does not wish to do so, Deputy Ring cannot persist in his interruption.

Mr. Dennehy

I will not give way. Another incorrect figure was that relating to the amount of money leaving the country. Some 67% is sent abroad while the remaining 33% is allocated to old age pensioners in this country.

I have been aggrieved by this issue for many years. However, my first concern was for Irish pensioners who were receiving inadequate support. This was, therefore, a significant decision. Opposition Members should raise the issue with their party leaders or party representatives on the Committee of Public Accounts and stop criticising the measure in the House. This is money well spent, as outlined clearly by Deputy Ring. It is given to those who need it. This year's figure of €130.2 million represents an increased allocation from last year's €117.4 million. Of that, some 52% goes to the UK, 8% to the US, 4% to Canada, 2% to Australia and the remainder to Argentina and other areas. The recipients of this allocation are people who worked in Ireland and were forced to emigrate. I had to do the same but was fortunate to be able to return.

A gesture such as this should not be manipulated for political purposes, as has been done in the Committee of Public Accounts in an attempt to denigrate the Minister.

Mr. O’Connor

Hear, hear.

Mr. Dennehy

The number of people receiving that benefit is 28,277. There is a level of hypocrisy about this issue. Deputy Rabbitte claimed yesterday that it was a right of these people to receive such a benefit. It was not a right. The Labour Minister for Finance in the so-called rainbow coalition refused to recognise pre-1953 contributions that did not include a contribution for pension. This was the argument in regard to this issue for years.

Deputy Ring was scathing in his contention that people would not be willing to apply for family income supplement.

That is ludicrous. I agree that a number of people are not aware of the payment. I send a newsletter to my constituents four times a year and I always include information about their right to FIS. This payment arose from the belief among social welfare recipients that it was not worth their while working because they were better off staying at home and drawing unemployment benefit or allowance. The payment has been raised to €39 per week. That might not mean much to Deputy Ring or people like him but it is a substantial amount for a person on a low income. It is a marvellous scheme. Its principal drawback is that people are not aware of it but we continue to try to overcome that. Fianna Fáil public representatives are, of course, in touch with more of the less well-off people than others so we are getting the message across to as many of them as possible.

When the special savings incentive scheme was introduced the Minister for Finance was accused of catering for millionaires and it was said that wealthy people would cream money from the poor. Lo and behold, the Opposition is now concerned that participants in the scheme might lose their medical cards. We have gone from one extreme to the other.

Mr. Crawford

What would Government Deputies do if they did not have the Opposition to blame?

Mr. Dennehy

The analyses show that the vast majority of people involved in the special savings incentive scheme are ordinary PAYE workers of whom the vast majority are on low incomes. The Minister has raised the amount of write-off. He has moved quickly in anticipation of a problem, as a good Minister should, and has dealt with it. I welcome that.

As a former chairman of a health board, my priority is the needs of people with disabilities and of carers. I am glad about what the Minister has done in regard to the respite grant. I understood Deputy Ring to say he did not know what it was. I will explain it to him if he wishes. The grant has been raised to €1,000 and 10,000 additional carers will be catered for. We must continue to drive on that issue. It is reckoned that there are 150,000 carers but I believe that count was done four or five years ago. I suggest the number has gone up since then. Because of the demographic make-up of the population it is certain that the number will continue to rise. We must identify carers as a priority and continue to work for them. There is always a danger that a carer will become a patient and a client of the State. In many cases one elderly person is looking after another.

The Minister has a huge commitment in this area and I urge him to keep up that good work. I am not surprised by his interest in social welfare. I have worked with him in other areas and I have seen his commitment. He has a track record of being elected by a large vote and one does not get that kind of support without a huge commitment to people. I say, "Well done and keep up the good work". I wish the Minister well and I commend the Bill to the House.

Mr. O’Connor

I thank my colleague, Deputy Dennehy, for sharing his time with me and I join him in applauding the efforts of the new Minister for Social and Family Affairs. Like Deputy Dennehy, I have had much contact with the Minister, Deputy Brennan. Before I became a Deputy, we shared a local authority boundary and now that I am a Deputy for Dublin South-West——

Mr. Crawford

For Tallaght.

Mr. O’Connor

——the Minister, Deputy Brennan, has been very kind to me. He has served his community extremely well. I am loath to say that the people at the end of my constituency which used to be represented by the Minister will miss him, but I will look after them to the best of my ability. I also have contact with the Minister in my role as secretary of the Fianna Fáil social and family affairs policy group and as a member of the Joint Committee on Social and Family Affairs. I have seen the Minister at work over the past ten weeks, getting to grips with his brief effectively and quickly. Members on both sides of the House have been impressed by the fact that he listens to what we say to him and is very responsive. If one cuts through the spin to which Deputy Ring constantly refers — there seems to be more spin on the Opposition side than on the Government benches — one sees that the Minister is delivering. Last week, the Evening Herald, which could never be accused of being a supporter of Fianna Fáil, listed the achievements of the Minister and commented, “All in all, a good budget”. Opposition spinning impresses no one.

Mr. Stanton

What about the cuts?

Mr. O’Connor

The Minister has started well. A lot has been done and there is clearly more to do, but we are with him and we support him.

Mr. Crawford

Who owns the Evening Herald?

Mr. O’Connor

As a Government backbencher, I will continue to campaign for my constituents and my community on the issues which concern people. Despite the progress, issues remain to be dealt with, particularly with regard to carers. Carers do a great job. On the work of the Joint Committee on Social and Family Affairs, which is under the able chairmanship of Deputy Penrose, the Minister knows we have a particular policy in that regard. We are happy with the progress made and with the announcement made in the budget and confirmed since. We must support the Minister in doing even more for carers.

In Tallaght, Firhouse, Greenhills, Templeogue and Brittas, the areas I represent, people are talking to me about the need for the Government to support child care initiatives. I hope the Minister will continue to do that — I know he will.

I support my colleague, Deputy Dennehy. I am also a returned emigrant and I am glad I came home. My grandfather and father before me were both forced to emigrate. I understand the issue Deputy Dennehy has highlighted and I am supportive of it. I am a keen supporter of the concept of looking after the Irish abroad and those who come home in their later years. During last night's debate on overseas development aid I referred to the question of returned missionaries and their social welfare entitlements. We must help people who have served the country in various ways.

The budget aims to eradicate poverty, remove inequality and encourage social inclusion. It is important that we support those aims. Like my predecessor, Chris Flood, I have been keen to support social inclusion policies in my work in Dublin South-West, particularly in the Tallaght end of my constituency. The Minister has always been supportive of that work. On a number of recent occasions we raised social inclusion issues arising from the west Tallaght report and it is important that we continue to do that.

I do not normally become involved in fighting other political parties toe to toe, but I would like to make some comments on Sinn Féin policies. I have been watching television, as other colleagues have, and I am happy with progress in Northern Ireland and am sorry the recent efforts have not gone all the way. The Taoiseach has done a tremendous job in this regard. I criticise Sinn Féin's tax and spend policies, which I have heard people in my constituency describe as dangerous and misguided.

The party's members are obviously not listening to what the Minister said in his budget announcement. The Bill provides for a €12 increase in pensions and a €14 increase in benefits to come into force on 1 January. I note that Sinn Féin's stated objective in this regard is to see Irish social spending increase to reach "at least the EU average". While this is clearly well intentioned, it is a fundamentally misguided objective. For many reasons, such as low unemployment and our young population, we have no cause to increase social spending to such a high proportion of our national income.

Social welfare expenditure has doubled in the past seven years at a time when unemployment has halved in all constituencies. Benefits, pensions and assistance have all increased at a rate significantly ahead of inflation and have kept up with earnings. To increase social welfare expenditure to 27% of gross domestic product, which is the European average, would mean an increase in spending of at least €12 billion. I have heard people say this is madness, and it is. It would mean having to more than double income tax. Sinn Féin will protest that it has no intention of raising income taxes and would hike taxes on capital and corporations. If that were to happen, obviously capital and corporations would simply leave the country, leaving no alternative but to tax incomes, which would have plummeted. This would be the reality of Sinn Féin's ghetto economics and everyone would lose. The country would be bankrupt. The spectre of emigration would return. It would be a national nightmare.

The Government led by Fianna Fáil with our colleagues in the Progressive Democrats has made great progress on social inclusion. We have halved unemployment, doubled expenditure and taken hundreds of thousands of the lower paid out of the tax net. We have introduced the minimum wage and this year's budget exempts those earning the minimum wage from payment of any income tax. Fianna Fáil has delivered real progress with our low tax social partnership model. I do not claim that the agenda is complete; we have more work to do. However, I believe our policies will move us forward and will afford opportunities to all.

To give some credit to Sinn Féin, I heard its spokesperson say on the national airwaves this was one budget with two more to go, as is the case. Clearly the Minister for Social and Family Affairs is following his programme in that regard. Earlier I said it was important to understand what the Minister is trying to achieve. He certainly has my strong support as well as that of my colleagues. The Minister can wipe away all the hype, forget the spin and should understand he is on the right track. I hope he keeps going that way and I wish him every success in that regard. I commend the Bill to the House.

Mr. Crawford

I wish to share time with Deputy McCormack.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. Crawford

This is my first time to speak when the Minister for Social and Family Affairs is in the Chamber and I congratulate him on his appointment. I welcome that increases have been made in many areas of social welfare. However, with such a booming economy, we would expect that at least. Those in need should be looked after. I appreciate the Government's change of heart. Inchydoney is a very nice place to have such a change of heart. Many of those who will benefit from the budget will never have a chance to go there. Fianna Fáil rethought its strategy and those on minimum social welfare benefit received an increase.

These people should enjoy it when they get it. If last year is anything to go by, through no fault of the Minister for Social and Family Affairs but through the failure of other Ministers to get proper budgets for local authorities, other charges will very quickly take the shine off the €14 increase. Having spoken to two county managers recently, I am aware of the pressure they are experiencing. They will be looking for increased charges for services, including waste collection and rent. The Government must seriously consider the level of increases permitted in rents for elderly people and those on low incomes. There is no point in granting increases in social welfare only to allow them be taken back very quickly in service charges, rent etc.

I obviously welcome the proposals to address the area of disability, on which I have frequently spoken since being elected to this House 12 years ago. We need to ensure that those with a handicap either since birth or through accident receive every possible assistance the State can afford. We will watch progress on those proposals with interest and those on this side of the House will hold the Government accountable to ensure the announcements become real benefits for those with disabilities.

I welcome the appointment of the Minister to this portfolio. While I had considerable time for his predecessor in many ways, I never understood how she allowed herself to be forced into a corner whereby she had to implement the 16 cuts in last year's budget. While one of those affecting widows and widowers was rectified, many others were not. The Minister has tinkered with some of these areas and he has made some improvements. Some changes need clarification and are subject to further discussion. I wish to mention two critical areas.

The Minister has gone half way towards rectifying the damage done to the back to education allowance. Many people can get themselves out of economic and social difficulty by returning to education. I recently attended a MIFET graduation in Monaghan town where it was fantastic to see the number of people who went back to education and got on the ladder towards a job. While the Minister has taken the first step towards rectifying the damage done by that cut, he should consider further action.

The dietary allowance, which represents a small amount in budgetary terms, has also been amended. Such cuts affecting the most vulnerable are unfair. Those in need of the dietary allowance often also have other problems and need considerable help owing to their sickness. When last year's cut, which saved the Exchequer €55 million, is compared with the mess over electronic voting which cost €55 million, it shows how unjustified it was.

As a member until recently of the Oireachtas Joint Committee on Social and Family Affairs, I spent a considerable amount of time dealing with carers. The committee compiled a report emphasising vital changes in support from Government that needed to be made to assist the elderly and disabled. We have seen some changes, which I welcome. The annual respite care grant has been increased from €835 to €1,000 and will also be given to others. The Minister claimed it has been given to all carers.

Will the Minister tell us how he came up with the figure that 9,000 extra people will benefit? If he has been told there are only 9,000 people in addition to those who are already in receipt of carer's allowance, something is badly wrong with those who are putting the figures together. There are many more who deserve support. There are many old age pensioners who are caring for a partner or even a parent or other older relative. Because they get the old age pension, they get no carer's allowance. Once they reach 66, they are taken off carer's allowance. They will now get the respite grant, a change I welcome, but they are entitled to more than a one-off payment of €1,000.

I have come across cases where a wife is looking after her in-laws and her husband is in low-paid work so she can get the carer's allowance. In one case the spouse died of cancer and in an accident in another case. The moment the spouses died, the wives were put back on to the contributory widow's pension and lost the carer's allowance. The Committee on Social and Family Affairs suggested that the least that could be done would be to give the widow or widower half of the carer's allowance. This would not create a precedent because if there are two people in a house, there is an entitlement to half of a carer's allowance for the second person. This would not cost very much but for these people it is essential.

I have problems with the way the Department of Social and Family Affairs treats small farmers in terms of the means test. Even those who live on the land beside their parents are caught by the ten hours of work rule. That was not taken into account when means tests for carers were first developed — it may have been in the book but it was not put into practice. It is now being abused by social welfare officers. If they can find any excuse, they will not pay.

Child care was ignored in the budget, an issue that will return to haunt the Government.

I came across a case last week where a man was injured outside work and is not entitled to compensation. He is in receipt of disability benefit. If he was on disability allowance or invalidity allowance, his teenage daughter would be entitled to a top-up of her college grant. The disability benefit is the man's only income but because it is a benefit for which he paid his taxes, working 35 years in the one job, rather than an allowance, he gets no help towards his daughter's college fees. That is wrong and it should be examined. It is a travesty of justice that someone who worked all his life, paid tax and PRSI finds that he is not entitled to assistance for his daughter when someone who is on an allowance would get it. I will write to the Minister about this because it is unjust.

I welcome the increases but will reserve judgment on them until I see how they turn out.

Mr. McCormack

No one will condemn the increases in social welfare payments in this Bill — we all welcome them — but it is our duty as Opposition to point out the opportunities that could be lost in the budget and the Social Welfare Bill.

The initial reaction to the budget was the gratitude of those people on low pay who are now exempt from tax, but many high earners and millionaires are still exempt from tax. It is our job to point out what could be done with that money if those people were brought into the tax net. The Tánaiste and Minister for Health and Children gave the impression the day after the budget that the Government had closed these loopholes but nothing could be further from the truth. The Minister for Finance gave these people the good news that they will not be touched for another year at least, giving them plenty of time to find other means to avoid tax liabilities. The previous Minister for Finance in his last budget extended the deadline for many of those tax shelter schemes and the new Minister has, despite what the Tánaiste said, given a clear indication that the deadlines will extend beyond 2006, when they were due to expire.

The Minister was presented with the best opportunity ever to make provision for those in need in the budget. How much more could he have done if these people had been brought into the tax net on this occasion rather than saying it will happen some time after 2006? Many tax exemption schemes in forestry, stallions, greyhounds, creative arts, urban and rural renewal, car parks and student accommodation that were to end on 31 December 2004 have been extended to 31 July 2006. So much for the hype since the budget.

The social welfare aspects of the budget did not even attract criticism from CORI and Fr. Healy. It is amazing what a little flattery can do. Some of the savage 16 cuts have been reversed and we welcome that — the Minister for Social and Family Affairs can take credit for that. How much more could have been done, however, if the Government had not wasted such a shocking amount of taxpayers' money, even in the past year? It was sheer arrogance to proceed with the €50 million expenditure on electronic voting in spite of all the warnings we gave to the former Minister for the Environment, Heritage and Local Government at the Committee on the Environment and Local Government. The Minister, Deputy Cullen, put his head down and continued with that crazy idea, spent €50 million of taxpayers' money and we must now pay to store these machines which were not used.

What about the millions of euro spent on spin doctors and public relations to make the Government look good? What about the millions of euro spent commissioning reports that did not lead to action? The Government has commissioned over 1,000 reports.

What did the Minister do for the most vulnerable and dedicated section of our community, the carers? There are at least 170 more carers coming into the system every day because people are afraid to go into institutional care or hospitals.

People prefer to be cared for at home. There is more pressure on family members to remain at home and care for an elderly person. I hope that if I or anybody belonging to me gets into such a situation the same would prevail in my case. I do not want to end my days in institutional care. I would prefer to be cared for, as most people would, in my own home.

Only 23,500 carers are in receipt of carer's allowance. This means that approximately 120,000 carers are not in receipt of carer's allowance. The Minister has said carers not in receipt of carer's allowance will get the respite grant. There are two aspects I ask the Minister to spell out because my interpretation is different from that put on it by the media and, perhaps, the Minister. Will those who did not qualify for carer's allowance because of the means test, and had not applied, be eligible for the respite grant? More importantly, will those in receipt of unemployment assistance who are full-time carers be eligible for the respite grant? My interpretation of what the Minister said, and I listened carefully to his budget speech, was that only those acting as full-time carers would be eligible for the respite grant. I do not know whether a person in receipt of social welfare, who is acting as a full-timer carer but has to be available for work if called, would be eligible for the respite care grant. Perhaps, in his reply, the Minister will clarify that issue.

I shall deal with one aspect of the carer's allowance which I have put to former Ministers for Social and Family Affairs, namely, Deputies Woods, Dermot Ahern and Coughlan, and to the commission which deals with carer's allowance and I have raised it at every possible opportunity. Deputy Crawford referred to it but not in the manner I will approach it. I am approaching it from practical experience in my work. A woman is caring full-time for her husband's relative, who is bed-ridden and incontinent, in her home. She is caring because she wants to keep that person in her home. Suddenly that woman, whose husband was a small farmer, becomes a widow. While she will qualify for the widow's pension she will lose the carer's allowance, despite the fact that she continues to be a full-time carer. She has to employ somebody to do the meagre farm work because she cannot leave the house unless somebody takes her place and she loses the carer's allowance. That is the most cruel aspect of the carer's allowance. There are not many cases where a full-time carer becomes a widow and continues to be a full time carer. I ask the Minister, as a compassionate Minister and the fourth I have asked, to deal with this matter. I am aware she will get the respite grant because she is a full-time carer but if that is all she gets it is a cruel decision. I ask the Minister to investigate that anomaly.

Mr. Carey

I welcome the opportunity to contribute to the Social Welfare Bill. I congratulate the Minister, Deputy Brennan, on the manner in which he has approached the Social Welfare Estimate and the Social Welfare Bill. He has hit the ground running. What he has done and what he proposes to do will make a huge difference to the lives of many. I was taken by some of the remarks in his opening contribution on the nature of social welfare and the dependence many have on it, such as the weak, the marginalised and the poor. Undoubtedly Ireland is quite a wealthy society. It is a test of our mission how we deal with them each year by way of targeted social welfare payments.

Since becoming a Member I have always concentrated on efforts for the young, the old, the most frail and the disabled. In this budget a package of measures has been put together which is coherent and caring and will make a difference to the lives of a large number of people. Thankfully, not as many as previously depend on social welfare payments for the unemployed, but they are in constituencies such as mine. There are those who are in and out of fairly casual, poorly paid work. It is important that we have a social welfare system that is people centred, as the Minister said earlier, so that these people are enabled to progress into employment. I have no doubt, despite what many say, the principal aspiration of the vast majority is to get out of unemployment and into employment. The satisfaction that gives, by way of a regular guaranteed income, changes dramatically the lives of many.

In his contribution the Minister said we must avoid a situation where one size fits all. I agree with him. His office and previous holders of the office and the officials who work for him are an example of a caring, professional, efficient Civil Service. The Minister and I had the opportunity last week to speak with some of the officials in the regional social welfare office in Finglas. One could not but feel a sense of pride for the way they deliver their work. There is no suggestion of being dogmatic, of attempting to catch people out or to deprive people of their entitlements. If anything, the reverse is the case.

The national anti-poverty strategy, which is embraced by all parties, underpins Sustaining Progress and previous agreements and is at the core of how we tackle the elimination of poverty. We must try to eliminate child poverty as much as possible and we are well on the way to doing that. I do not think Fr. Seán Healy expects to be quoted here all the time but he has been, and rightly in many cases, a severe critic of the attitude of Governments. However, the Governments with which I have been associated since becoming a Member of this House in 1997 have shown an enlightened and caring approach. I will not throw out plaudits unduly to this side or criticisms unduly to the other side but the facts speak for themselves. When others had an opportunity of providing a caring system they did not crown themselves in glory so far as generosity was concerned.

The Minister said we need to constantly monitor the pulse of our changing society and broaden and evolve to respond to changes. That is what the Minister and the Government have achieved in the budget and will also achieve by the implementation of the Bill. Undoubtedly the rising tide has not lifted all boats. Some, thankfully not as many as there were, are stuck in the mud and need to be lifted by a series of targeted measures and some of the measures in the budget will make a difference.

When the Minister visited Coláiste Íde in Finglas last week, he presented certificates to a group of severely disabled people who have the potential to be among the most marginalised people in our society. However, I found that they were among the most positive people I have ever met. The social welfare system has given them an opportunity to engage with education. Virtually all of them are confined to wheelchairs, some of them are blind and others were seriously injured in horrific road accidents. They can use laptop computers provided by the Department of Social and Family Affairs to participate, in their own homes, in a programme of wireless education provided by the VEC. Their quality of life has improved dramatically as a result. Many years ago, I taught the sons of a man who attends the college. Although he has a very debilitating disease, he is helped in life by being given an education. That is made possible by technology, which is provided by the Department of Social and Family Affairs with the help of officials in Mellowes Road and the VEC in Ballsbridge.

Measures such as the back to education scheme are helping to move the goalposts slightly. Many of the most enlightened measures which have been introduced, mainly by the current Government, relate to second chance education. Such measures have made a huge difference. Many women who started off by taking budget management courses which were funded by the Society of St. Vincent de Paul have moved through the system, some as far as university level. The measures I have mentioned can make a real difference.

I welcome the Minister's decision to increase the level of support for the Family Support Agency. It is expected that the Government will assist the long-term unemployed and provide child benefit, but the support being given to the agency is just as good an example of a focused measure. The family resource centre programme is being allocated an additional €2 million. I have seen at first hand that the programmes organised by family resource centres have transformed many communities. The lives of people in communities in partnership, RAPID and CLÁR areas have been completely changed. The family mediation service is being given funding of €900,000 to assist it in its expansion programme. It is important that the Government supports such a service at a time when relationships and marriages are breaking down to an increasing extent, unfortunately.

I happen to know many of those who work for the money advice and budgeting service, which is a truly magnificent body. It is probable that the people in question, who were largely responsible for getting the service up and running, will never be satisfied that they have enough money to support all the work the service needs to do. The service has stabilised many families which were unable to pay ESB bills or rent and could not afford the essentials of life. Its work has transformed the lives of many members of such families.

Many people would argue that it is to be expected that I have such great admiration for the work of Comhairle, which organises a fine network of community and citizen information centres and provides objective support and advice, which is critically important. Many people who are afraid to inquire about their entitlements prefer to approach public representatives such as Deputies and Senators. We should encourage such people to locate information in a non-threatening environment, such as that provided at community information centres.

Deputy McCormack spoke about the problems of carers. We need to recognise that it is a developing area. I will discuss child care later in my speech, if I have enough time. It is not long since we knew very little about the nature of caring. We still do not know enough about how to tackle the matter. The budget and the special measures introduced by the Minister will ensure that those who provide caring services in the home, usually under difficult circumstances, will find it easier to work with those for whom they care. It is never easy to care for somebody who is suffering from a seriously debilitating disease, such as Alzheimer's disease, which can affect elderly people, or Parkinson's disease, which can affect younger people. Extremely good opportunities are given in this budget to those who provide such assistance.

I have often been slightly critical of the social welfare code, not because I think it is a bad code but because it has "growed" like Topsy. I would compare it to the construction of multiple extensions to a house, few of them without planning permission. Perhaps we will have to consider, in the not too distant future, dismantling the system to consider how to deliver a properly integrated system. That may be necessary for a variety of reasons, not least of which is the looming pensions issue which will result from our ageing population.

Many Deputies have spoken about the various adjustments which had to be made to last year's Estimate. While some of their criticisms were valid, certain comments were wholly irresponsible. I compliment the Minister for Social and Family Affairs, Deputy Brennan, on the way he has quickly addressed certain causes of great difficulty to social welfare recipients. I have referred to the back to education allowance. The Minister made a good adjustment to the allowance by reducing the qualifying period from 15 to 12 months and raising the grant from €254 to €400. Without exception, those involved in returning to education, with whom I often deal, as Deputies are aware, have welcomed the adjustment the Minister has made. I welcome the merited adjustment made by the Minister to the one-parent transitional payment.

Although I think people are entitled to receive rent supplement, I am slightly ambivalent about the scheme as a whole because I think the Department of Social and Family Affairs has bailed out the Department of the Environment, Heritage and Local Government for too long. It is time to knock some heads together in this regard to try to bring some coherence to the assessment of housing need and the development of housing policy. There is no better person to do so than the Minister for Social and Family Affairs, Deputy Brennan. I approve of the adjustment that has been made to the rent supplement scheme.

I spent a great deal of time working on thecrèche supplement payment over the past year because I was concerned that it had an adverse impact. I am aware that the Minister, who listened carefully to the details of a number of case studies I presented to him, engaged with the social partners as part of the Sustaining Progress process. Some of his most senior officials took the opportunity to visit a number of areas, which I cited as being worthy of examination, to observe the impact of the crèche supplement payment. I am delighted with the Minister's decision to restore the previous system because I think it will make a huge difference. Some of the providers of nurseries have been writing to the Minister to thank him for that initiative and to congratulate him thereon. At least one provider has invited the Minister to attend a Christmas party next week. I do not know whether he will be able to accept the invitation to the party at Our Lady's Nursery in Ballymun but, if so, he will receive a very warm welcome.

Let us consider the issue of child care. The Government has rightly concentrated support for children on the very generous increases in child benefit. However, we must now consider whether we should re-examine the provision of child care. Child care and early childhood education are being delivered in a largely incoherent way, bearing in mind that, where they are being delivered, the results are very good. We are well aware of the Early Start educational programme. Montessori schools and the National Day Nursery Association provide services. Services are also delivered through the very extensive equality measures of the Government's national development plan. Slightly more than €500,000 is being invested in supporting the supply of services. Undoubtedly, there is great improvement in this regard but we will ultimately have to address this area quite fundamentally in the course of the coming year.

Deputies Penrose, English and I happen to be members of a working group of the National Economic and Social Forum which is examining early childhood education and child care. We hope the group will be in a position to report to the main council in April 2005 and that the Government will consider positively the range of options put forward by the council to see if it can put in place a package to deliver first-rate, high-quality child care. We must recognise that child care and the support of those with disabilities will not come cheap but it is incumbent on us to ensure that our youngest and most frail are generously supported. All the evidence suggests that young people who have had the benefit of high-quality child care and early education do far better, not just in education but generally in later life.

I compliment the Minister on his ingenuity regarding the assessment of capital. There was considerable concern that one's having a special savings incentive account would have an adverse impact on one's social welfare entitlements. In this regard, the Minister's raising of the ceiling to €20,000 is important and will make a significant difference. It will put at rest the minds of many people who were worried about the fate of the nest-eggs they had saved for a rainy day, such as their having to live in a nursing home or on a reduced income.

I will conclude with my annual whinge. I know the Minister does not agree with my position on the child dependant allowance issue. I know all the arguments that have been made by the Minister and his predecessors in this regard and they do not differ very much from each other. However, I would love if we could have another review of the child dependant allowance, possibly in the coming year.

I happened to have the privilege of being in the House of Commons three weeks ago for Prime Minister's question time. The Prime Minister, Tony Blair, stated he was very proud to tell the House that free television licences were being extended to those over 75 years of age in the United Kingdom. There was a time when the shoe was on the other foot such that the entitlements in the United Kingdom were far superior to ours, but Irish society, harsh as some might say it is, is now very largely caring and enlightened in the way it has managed to provide targeted supports for those who need them most.

Mr. S. Ryan

I wish to share time with Deputy Moynihan-Cronin.

An Leas-Cheann Comhairle

Is that agreed? Agreed.

Mr. S. Ryan

I am pleased to have the opportunity to contribute to the Social Welfare Bill 2004. I look forward to debating the relevant issues with the Minister at meetings of the Oireachtas Committee on Social and Family Affairs.

I broadly welcome the increase of €14 per week in weekly social welfare payments and the increase of €12 per week for pensioners. These increases are the very minimum that people could have expected to receive given the favourable financial position of the Government. Tax receipts of €1.7 billion are above expectations and borrowing is expected to be €1.6 billion lower than the figure originally predicted.

It should be remembered that this is the third year in a row in which the increase in child benefit is below the level required to meet commitments made prior to the general election of 2002. It is also very significant that there have been no increases in the child dependant allowance. This allowance is a significant, targeted anti-poverty payment that should play an important role in combating poverty, especially child poverty. The Minister obviously does not view it in this light.

Ireland may well be a rich country, if not one of the richest in Europe, but we must ask if it is an inclusive country. To test for this, we must consider the manner in which we include the most vulnerable in our society. It is a cause of great concern that a significant minority still does not have the basic necessities, such as a warm overcoat and a meal with meat, chicken or fish at least every second day. The increase in relative poverty and the widening gap between those on low incomes and higher earners reflects the policies of the Fianna Fáil-Progressive Democrats Government in recent years.

Some 22% of our population, or almost 800,000 people, are receiving below 60% of the median income and experience basic deprivation. The increase of €14 per week is not likely to change the lifestyle of a person living on €148.80 per week who has no immediate prospect of getting a job or securing a local authority house. This is due to the failure of the Government to prioritise social and affordable housing.

Having listened to the Fianna Fáil Deputies in the House and having read some of the right-wing economists in the media, I note that they are not living in the real world. The increase of €14 per week, welcome as it is, represents an increase of only €2 per day. Various local authorities have already drawn up new scales for payment for differential rents for 2005. I was on the phone to one authority this morning and was informed that there will be an immediate rent increase of €1.60. This will affect those who are to receive the increase of €14 per week. At the same time they must endure a continuous range of stealth taxes, including increases for fuel and the ESB. That will leave very little to purchase extra bread, a half pound of butter, a packet of cheese or even a half dozen eggs. I priced those items in the supermarket this morning and they came to almost €7.

Many people expected an increase in the living alone allowance. The rate of €7.70 per week has not been increased since 1996. Various reports have shown that most of the older people at risk of poverty are women living alone. This payment affords the State the opportunity to target resources at these vulnerable people. The Minister's failure to do so is contrary to the recommendations of the national action plan against poverty and social exclusion, and is regrettable. Groups such as the Irish Senior Citizens Parliament and Age Action Ireland have highlighted the fact that the extra allowance for people aged 80 and over has also not been increased since 1996. This payment recognised the additional needs pensioners in this category have and I am appalled that once again the Government has failed to increase this payment.

I made numerous representations to the Minister's predecessor, the Minister Deputy Coughlan, and to his Department regarding free travel passes, particularly for older people in Dublin, Cork and Limerick who have hospital appointments and are obliged to leave home prior to 10 a.m. These restrictions cause difficulties and are a bone of contention for older persons and the various organisations which represent them. Having listened to the excuses and read the reports emanating from CIE and the Department of Social and Family Affairs it should be possible to have this matter resolved and I call on the Minister to reactivate his efforts on this issue.

I welcomed the €12 per week increase for pensioners. It should be noted, however, that the programme for Government promised to increase the basic rate to at least €200 per week by 2007. This is one commitment that must be met. There will always be anomalies in respect of pensions unless and until pensions are linked to what working people earn, which is most fairly assessed as the gross average industrial earnings. The Pensions Board report on the national pensions policy initiative in 1998 recommended that the minimum retirement income for State social welfare pensions should be 34% of gross average industrial earnings. Six years later there is still a considerable way to go. That is a target to which we in the Labour Party are committed. We will vigorously pursue the Minister on this issue and if that commitment is not met before the Labour Party returns to Government after the next general election we will implement it.

In its pre-budget submission Age Action Ireland referred to the commitment in the programme for Government to introduce a personal pension entitlement for pensioners' spouses to receive the qualified adult allowance, set at the level of a full non-contributory pension. I strongly support the recommendations that the qualified adult allowance rates be increased over the next three years to equal the full non-contributory pension.

The Minister has failed to deal with carers. He has met them but they are particularly disappointed with the Social Welfare Bill and I do not blame them. We have raised this issue regularly over the past five years and thought there would be a specific commitment this year on it. In some ways this Bill is a con trick. The media has been sold the perception that the infamous 16 cuts which were so detrimental to Fianna Fáil and the Progressive Democrats in the local elections have been redressed. They have only been modified in certain ways and we will have an opportunity on Committee Stage to tease this out further. While we broadly welcome certain elements in the Bill, we have grave difficulty with several areas, particularly the savage cuts, which are not being remedied, and a lack of real support for carers.

Ms B. Moynihan-Cronin

I welcome increases in payments because any increase for recipients of social welfare is welcome. I studied the Bill over the weekend and found that it is not all good news. One frightening fact I discovered, of which no doubt the Minister is aware, is that following the social welfare increases in this Bill, a married person under 66 on invalidity pension will receive €154.30 and their dependant will receive €110.10, giving them a total weekly income of €264.30. When the new medical card income thresholds are introduced, the threshold for this married couple will be €222.00, putting them €42.30 over the limit. In effect, this will result in this couple losing their medical card.

In most cases where a person is in receipt of a social assistance payment he or she would retain a medical card, even if the social welfare rate exceeded the threshold for the medical card, at the discretion of the community welfare officer. For those on benefits, however, who have paid their contributions, I am advised by a community welfare officer that there is no guarantee that the couple I outlined will retain a medical card. An elderly couple on an invalidity pension will not qualify on income grounds for a medical card when the new social welfare increases take effect. They should not have to rely on the discretion of a community welfare officer because as we all know that discretion is being curtailed every day. The Minister should look at that and ask the Minister for Health and Children to deal with it in the income guidelines for a medical card.

There is a further deficit in the social welfare system as it pertains to people coming off community employment schemes. Up to now they could proceed to receive full unemployment assistance on leaving the scheme. However, under the recent provision for community employment workers, on leaving the scheme they must apply for unemployment benefit. Given the structure of these graduated payments, a person coming off a scheme can qualify only for the basic rate of unemployment benefit of €105.60 per week. What is more, that person will not get a Christmas bonus and will not be eligible for the fuel allowance.

Were that community employment worker to remain on the dole, he would receive €134.80, over €30 more than he would get coming off a community employment scheme, and he would retain benefits such as the Christmas bonus and the fuel allowance. There is little incentive for people in long-term unemployment to take up a place on community employment schemes because they would be better off, financially, staying on the dole. The Department of Social and Family Affairs does not advise people on disability benefit who may be eligible for the invalidity pension that they are so eligible. The disability benefit is a short-term payment which does not allow access to the fuel allowance, the Christmas bonus, living alone allowance or the household benefits package. Like everyone else, I have several constituents who have been on disability benefit for a long time and should have been on an invalidity pension. They must be on it for a year, but people do not understand that they are entitled to an invalidity pension. The disability benefit is a short-term payment which does not allow access to the fuel allowance, the Christmas bonus, the living alone allowance or the household benefits package. They are losing out on all that.

The invalidity pension, as a long-term social welfare payment, allows receipt of the fuel allowance, the Christmas bonus, the living alone allowance and the household benefits package, but in my experience, which I imagine is replicated on all sides of the House, the Department is making very little effort to encourage those eligible to move from disability benefit to invalidity pension. I make the fair and reasonable request that the Minister take it up with his officials in the section dealing with disability. It would be fairly easy using computer systems to ascertain who has been on disability benefit for more than a year. It would mean a great deal to those people, and I hope that the Minister will be positive in his reply.

I also want to raise an issue that I raise during the debate on every Social Welfare Bill and budget and which I will continue to raise until something is done about it, namely, the manner in which the Department of Social and Family Affairs assesses a person's capital assets for social welfare eligibility. When a social welfare applicant is assessed, the interest he or she accrues on any savings or capital in a bank account is taken into account. However, the guidelines for that assessment are a joke. For example, a person with €40,000 in savings in a bank account, which is not much in this day and age, is assessed as having a weekly means of €37.63. A person with €50,000 in savings is assessed by the Department of Social and Family Affairs as earning €77.67 from that money every week.

Perhaps the Minister might tell me of a financial institution in this country which allows a person to deposit €50,000 and receive an income of €77 per week. That is 8%, and we all know that not even Ansbacher would give 8% for €50,000. Why does the Department continue to assess people with paltry savings at 8% when they currently receive 2%, a figure that has remained constant for some time? It would be simple for recipients to give their bank account number and provide a statement of interest on which they could be assessed. That would be very fair. What I seek is not unreasonable. Will the Minister examine that issue? He would make a name for himself, since the current assessment is 6% above what people are getting. It deprives many people of social welfare income. That sort of money in the bank is not very much, especially if one is faced with entering a nursing home at a cost of €600 or €700 a week. It would not last long.

It is disappointing to note that nothing significant has been done for carers. The Labour Party will vote against the Second Stage of this Bill, not because of the increases but for two reasons in particular. Nothing specific was done for carers. We introduced a Carers' Bill in Private Members' time recently which received verbal support from all sides of the House although Government Deputies obviously had to vote against it. Everyone agreed with what was said in that Bill, namely, that the means test should be deleted from the carer's allowance. My colleague, Deputy Seán Ryan, also referred to it. There was no row-back on the savage 16 cuts, which were tinkered with.

For that reason and those which I have mentioned, we will vote against the Bill. On a positive note, I hope that the Minister will consider the two reasonable requests that I have made to him.

Cecilia Keaveney

I congratulate the Minister for Social and Family Affairs on his new portfolio, this being my first chance in the Chamber to wish him well. I also wish my county colleague and former Minister for Social and Family Affairs, Deputy Coughlan, well in her role in the Department of Agriculture and Food.

When one considers the amount of money passing through the Department and the number of people dependent on the decisions made and success achieved when various Ministers go to the Department of Finance, one sees that this is one of the most important Departments. For that reason, the success over several years in increasing funding allocations must be acknowledged and welcomed. It is incredible that there is almost unanimous support for this budget. It is impossible to please everyone, and if we think that we are doing so, we are deluding ourselves. However, people in so many quarters have found such hearty praise for this budget and, in that context, for the Social Welfare Bill, that it is disingenuous for people to try to pick holes in an extremely good package.

I always find it very easy to relate to my first day in the House, partly because the said Minister got kicked out that day on an issue regarding Luas, which he has now delivered, just as he is now delivering his social welfare budget from this side of the House. Deputy Seán Ryan complained about €2 a day being given, but in the budget at that time, child benefit was increased by 25p a week. When one considers the allocations being made to different sections of the community which deserve it, there is no doubt and one must acknowledge that there has been great success and forward movement, not discounting inflation.

Some people have claimed that the real reason this budget was so good was the local election results and people being told the Government was not delivering. In my area, with Francis Conaghan, Rena Donaghy, Denis McGonagle and Marion McDonald, we increased the number of our council seats by one and retained Rose Cullen, Joseph Doherty and Dermot McLaughlin in our urban council. People in my area recognise that this Government and its predecessor have been delivering on social welfare as much as on every other aspect. While they recognise that there are still issues to be addressed, including in social welfare, they trust and accept that this Administration has their best interests at heart and will deliver. It will not deliver to everyone at once, which is impossible because money is finite, but to all over its term of office. We were derided the first time that the former Minister, Deputy McCreevy, introduced a budget but, as he progressed to his fifth, the laughter rapidly decreased.

Some people will be happier than others, but no one can begrudge the details of the Social Welfare Bill and the budget in general which have brought radical improvements in funding for the delivery of services, especially to those with disabilities, something connected with recent Government legislation. There have been improvements in taxation policy, specifically the tax reliefs for the elderly, the disabled and the widowed, which are extremely important. The fact that 650,000 income earners on the minimum wage have been removed from the income tax net ensures, or helps to ensure, that people will be more inspired or encouraged to move into employment where it is available rather than those on lower incomes looking to the family income supplement which has been greatly improved in this budget. They may no longer have to depend on unemployment supports.

Coming from an area where there is high unemployment, I welcome the supports for those who are not in employment. However, ultimately, I would be much happier if we had no need for unemployment supports and if people currently in receipt of unemployment assistance or unemployment benefit were working.

Given that this Bill presents the opportunity to talk about social welfare matters, it would be remiss of me not to encourage the Minister for Social and Family Affairs to expedite and move forward the decentralisation process to Buncrana, to which staff of the Department of Social and Family Affairs are due to transfer. Given the great strides people in the Department are making in Letterkenny and other locations, in time people will realise that we have a great natural resource in terms of people, environment and location. We have a treasure in Donegal, which we are afraid too many people might discover, but we will whisper about it at present and encourage those in the Department of Social and Family Affairs to reconsider the location and to visit the area to check out the resources available. We often use the opportunity to speak on the area to moan and call ourselves peripheral but we only do that in an effort to ensure that people do not abuse the wonderful area of Inishowen and other places in Donegal. I ask the Minister to move forward the process. The site selection process is almost at completion stage. I ask him to take a personal interest, as his predecessor did, in expediting this mission.

It goes without saying that the increases in this social welfare package are larger than in the past. A social welfare package of €874 million was announced in the budget. This represents a €244 million or 40% increase on the 2004 package. We welcomed the package of €630 million last year and thought that we were doing well, but it is staggering to have a package this year that represents an additional €244 million on the 2004 package and an expenditure of €12.25 billion. It is worth making the point and for people to realise that the Government is focusing on improving the standard of living of people with disabilities, carers, children, the elderly, widows, widowers, the unemployed, lone parents and other disadvantaged people.

Every year we have seen an increase in the social welfare expenditure, but there has been a 60% increase in such expenditure in the past four years and a doubling of what was spent in 1997. When one has been a Member of the House for a number of years and been present for the introduction of a number of budgets, one realises the number of decisions that have to be taken to ensure such expenditure is targeted at those who really need it.

The Minister mentioned a fascinating statistic, namely, that for every €3 that will be spent by the Government in 2005, €1 will go in social welfare entitlements. Some 970,000 people will claim weekly social welfare payments next year, which will benefit some 1.5 million people, if one includes dependants. It is a challenge to please all the people, but this package will please a large percentage people, given that 1.5 million will benefit from increases of between 7% and 10%, which is three to four times ahead of the expected rate of inflation for the coming year. Such increases are significant.

There is much talk about the savage cuts with which the Minister has moved to deal. He said he was moving towards keeping the whole process under review. It is important for the Department to bear in mind that life does not stand still and that the Minister has a sense of what is happening. If I was critical of any of the cuts, I would have an issue with the back to education allowance. Reducing the qualifying period from 15 months to 12 months is an important step, but it should be reviewed in terms of reducing it further, possibly to the level it was at. That is my genuine view having met a number of people who could return to education, having acquired their positions, yet the financial implications of the move means they often have to, as is proverbially said, go back on the dole for a year. That money is wasted because those recipients are taking it from the State in any event and could be participating in education and obtaining their qualifications, but all they are doing is biding time until they eventually qualify. If the reason for this measure is that it would encourage the recipients to move into employment, there might be an argument for it. However, the people with whom I have been dealing have had a clear vision of where they want to go and the need for the qualifications to which they are aspiring. To begrudge such qualification for the allowance to them for a year is not positive. However, the reduction in the qualifying period from 15 to 12 months is an important step, but the Minister might monitor it and further reduce the qualifying period.

There has been much talk of nothing having been done to provide for carers. One of the important developments in social welfare since I was elected to the House was the introduction of the respite care grant introduced by the then Minister, Deputy Dermot Ahern. It offers carers an opportunity to have a necessary option or alternative in terms of support for full-time care. I am glad that the Bill provides for an increase in the grant by €165 to €1,000. The introduction of this grant was innovative. It is worthy of recognition in terms of an increase in this Bill. I welcome the change whereby the limit of payments of respite care grant to only two recipients will be abolished. The condition requiring recipients of carer's benefit to be in employment in the three months prior to the commencement of full-time caring is important. Another change is that the Minister has opened the scheme to allow an additional 9,200 full-time carers to qualify for the grant for the first time. Some 33,000 people are expected to receive a grant of €1,000 next year. We should monitor the issues in respect of carers, but the change in the means testing means a couple with two children can earn up to €30,700 and receive the maximum rate of carer's allowance and a couple can earn up to €49,200 and receive the minimum rate of carer's allowance and still qualify for other benefits. Carer's qualification for other social welfare supports was an issue that was regularly raised with me. If one was not entitled to the carer's allowance, one did not qualify for many other welfare supports. It is important that the Minister has opened the scheme to ensure that carers can be entitled to some welfare supports, if not the entire package of supports.

I echo much of what has been said about carers, namely, the importance of increasing, by way of financial supports, the ability of people to take on the role of recognised carers. People who are wealthy have the alternative of putting their dependants into some sort of institution or they can employ people to look after them. However, many people who are caring for their dependants are not wealthy and miss out on welfare supports. Such supports are beneficial and have made a significant difference to many people's lives.

I welcome the fact that many of the increases will be implemented from the beginning of January. In the past increases on petrol, cigarettes and alcohol were imposed from midnight on the day of the budget whereas increases in social welfare payments were sometimes not implemented until November. January, February, April and May are the only months mentioned. Bringing forward the payment of these increases and allowing people to benefit from them has been an important change over the past couple of years.

The increase in the threshold to €20,000 in assessing capital for all schemes except the SWA is also very important. There is no point in encouraging people to save responsibly by putting their money in a financial institution rather than under the bed if as a result they lose out on a vital part of their income.

Although it is not specifically related to this Bill, I welcome the introduction of the doctor only medical card. In my area there is quite a good reaction on the part of the health board to applications for medical cards made on medical grounds. It is not stressed that there are two ways of getting a medical card, on the basis of means or on the basis of need. Where there is genuine medical need, the health board has usually facilitated the provision of a medical card. It should be reiterated that if a person has a medical problem, application for a medical card should be made on medical grounds.

I have a problem with the increase in the threshold for the drugs payment scheme, particularly for people on low incomes who rely on family income supplement. I often wonder why medicine does not seem to be getting cheaper given that in the era of high technology, plasma screen televisions and computers have come down in price. I do not know anything about this area so I am shooting in the dark. Are there plenty of checks on the money being paid to pharmacies by the State under the drugs payment scheme? I do not know the answer to that and I do not have any particular agenda other than the belief that if people are going to be paying more every month, the other side of the coin is that there must be adequate checks on what it is costing to provide the service.

I agree with Deputy Moynihan-Cronin that some people who should be on long-term invalidity support are in receipt of disability benefit for a year or more. Perhaps the Minister would examine that issue so that people will be given the correct payment from the start. That would save money because it would avoid the necessity of carrying out another assessment in respect transferring to the alternative benefit.

We should try to minimise bureaucracy and red tape. Ultimately it is like dealing with the vintners in the context of the national identity card. Bureaucracy could be minimised if there was joined-up government and all the information was available in one place. Joined-up government would have been helpful in the context of the dietary supplement change, in terms of rural transport initiatives, and in so many other Departments. That issue is incidental to the Bill under discussion. There are so many issues to which I did not allude, including maternity benefit.

The package speaks for itself. It provides €12.25 billion in 2005. Many people will gain from it. They will be happy to see their benefits increase rather than remain static. I look forward to the next couple of budgets which will conclude the efforts being made on the five-year programme.

Mr. Gregory

I wish to share time with Deputies James Breen, Trevor Sargent and Caoimhghín Ó Caoláin.

An Ceann Comhairle

Is that agreed? Agreed.

Mr. Gregory

I take the opportunity to put on record my support for the An Post workers who marched here today. They have received no increases despite the fact that over the past two years they were due quite small increases on their very small wages. The An Post pensioners have also been denied the meagre increases due to them. I pay tribute to the workers and their unions——

An Ceann Comhairle

The Deputy may make a passing reference to An Post. We are discussing the Social Welfare Bill, to which it has no relevance.

Mr. Gregory

In the context of the pensioners——

An Ceann Comhairle

The Deputy may make a passing reference only.

Mr. Gregory

The social welfare increases are welcome for those unfortunate enough to have to survive on social welfare amid so much wealth and affluence. The unfortunate people on social welfare must survive on less than €150 a week. Even with the increases, they do not reach a level in line with the minimalist objective of the national anti-poverty strategy which set a target to be reached by 2007 of €186 a week. That is the anti-poverty target for the lowest rates of social welfare. For even that much to be achieved increases of €18.50 a week will have to be given in budget 2006 and budget 2007 because the increase in this budget for 2005 is less than the strategy required. CORI, which again produced its critique and analysis of the budget in record time, summarised the increase thus: "While the new social welfare rate of €148.80 is a major improvement, delivery of the NAPS commitment remains critical."

As we all know, and people who survive on social welfare know it far better than any of us, within two months of their receiving their €12 or €14, if they live in local authority accommodation, and the vast majority of them do — the vast majority of tenants in Dublin City Council survive on social welfare — the rent goes up and the €12 automatically becomes €9 or €10, and it does not take very long for that to be eaten up by other increases. That is the reality and many of them have told me over the weekend that while they welcome the increases, they are very rapidly swallowed up, in some instances at least, by the State itself via the local authority. Moreover, many will say that the main reason these social welfare increases look so good is because they follow seven years of neglect.

I will refer briefly to the savage 16 social welfare cuts. I understand the Minister has them under review. The perception at the time of the budget was that they would be reversed. That has not happened.

Mr. J. Breen

I welcome the significant increases in allowances, pensions and a range of other supports that will directly benefit the 970,000 who claim a weekly social welfare payment and particularly welcome the funding for disability and unemployment benefit. I also welcome the commitment from the Minister that young people suffering from autism who are currently in psychiatric homes will be removed and placed in suitable and safe surroundings.

The changes directed have reduced the measure of unnecessary anxiety, pressure and confusion among the vulnerable sections in our society. The Bill ensures positive steps towards the modernisation of social protection, including the provision of care, improvement of social inclusion and combating poverty in our society. However, some glaring anomalies remain. A carer travelling with a person under 16 years of age enjoys free travel whereas a 16 year old must fund his or her bus and train travel. The 16 year old should not have to pay and the free schemes will have to be extended to allow both carer and young person to travel for free.

While there are approximately 50,000 full-time carers, as a result of the 2004 budget only 1,000 extra carers will now receive carer's allowance. Only 24,000 will get carer's allowance and approximately 100,000 part-time carers will not receive carer's allowance. A widow should be entitled to receive both widow's pension and carer's allowance if she operates as a full-time carer but the social welfare single payment rule prevents this. The Carers Association urged the Minister to waive this rule for pensioners and lone parents in particular, two groups which are often on the poverty line.

As a lone parent or pensioner, one is only allowed to receive one payment. If a carer is in receipt of a disability payment, he or she cannot also receive carer's allowance. The carer's allowance should be increased to the same rate as a nursing home subvention, which is €190 per week. It is stated Government policy to maintain older people in their own homes for as long as possible. However, the Government pays to put the old in nursing homes but does not keep them in their own homes.

Much change has been achieved with the 2004 budget but much remains to be done. Will the Minister consider removing the means test for carers? He should be more generous when old age pensioners apply for the non-contributory pension and something should be done to help those who are a few euro over the qualifying threshold. For example, a man from my county was €1 over the threshold but was not entitled to his old age pension. That is not right and the Minister should seriously consider this issue.

Mr. Sargent

Gabhaim buíochas leis an Teachta Gregory as a chuid ama a roinnt liom. Like Deputy Gregory, I record my support for the An Post workers who have a valid case that needs to be answered by Government. I hope they do not find themselves seeking social welfare due to unemployment in addition to the injustice they have already suffered. The Government needs to seriously consider the issue of mismanagement that the workers are highlighting. The increases they seek are modest.

An Ceann Comhairle

As I told Deputy Gregory, the debate is on the Social Welfare Bill.

Mr. Sargent

I have made my point. I listened carefully to the Minister, Deputy Brennan, stating that for every €3 spent by the Government, €1 is spent on social welfare. He stated that two out of every five people would receive some share of the €12 billion being spent by his Department. However, the Government should ensure that we integrate more closely as is the case in other countries. There is no difference between the money paid as a tax allowance and that paid as social welfare. It is effectively money which the State foregoes. However, there is a perception that if one gets money by way of a tax allowance, one is being of great service to society by being employed whereas if one gets the money by way of a social welfare entitlement, one is utterly dependent and in some way disempowered by virtue of the fact that one is seen to be getting some kind of handout. While I know we call it an entitlement and it is not a handout, I ask that the integration of the tax code and social welfare code might reflect that all of us, including the Minister and I, get some benefit from the State by way of a tax allowance, in the same way as a carer or person in receipt of child benefit. Moreover, we should quickly get rid of the exemptions and anomalies which mean that not only are workers on minimum wage outside the tax net but those on huge incomes are outside it, which is an injustice that continues to fester.

The legacy of the system where all employment is considered good is an oversimplification which leads us to overlook many problems caused because the production of items which hurt or damage people and society is still considered good, so long as it gives employment. Our values need to be assessed to check that we are not excusing activities that do damage by perceiving them as good.

Many on social welfare would remind the Minister that all good work is not paid, including caring, child rearing, repairing one's house or growing one's own food, all of which contributes to society in no small way. Deputy Keaveney referred to the need for joined-up thinking and I support her call. Currently, the poverty trap in the social welfare system means that people are afraid to make changes. They are afraid to even change jobs, which makes a good case for considering more closely the guaranteed basic income scheme. I briefly discussed this with the Minister and would like to discuss it with him again because the Government has reached a point where it sees the merits and logic of moving closer to this.

As the Green Party finance spokesperson, Deputy Boyle stated that introducing returnable tax credits would be easily achieved and would also mean that the minimum wage earner, who currently foregoes any tax credit, would at least get the tax credit, which would be a beginning to the recognition that we are all involved in contributing to society whether we get paid through the Department of Social and Family Affairs or by way of the Revenue Commissioners with a tax allowance. This needs to be integrated and we need to end the false dichotomy and recognise that a guaranteed basic income would be a way to achieve this.

Caoimhghín Ó Caoláin

Sinn Féin welcomed the increases in social welfare payments included in the budget announcements, although many of the increases were long-sought and long overdue. The Government needs to accept that increased investment in social protection helps society as a whole. Social welfare payments are important in helping people through times of difficulty when they face unemployment, the risk of becoming homeless or are caring for elderly or ill relatives. They should not be viewed as handouts, the cost of which the Government must keep to a minimum. Rather, they are necessary to aid low income families with the cost of child care, fuel costs, special dietary requirements etc.

Increased social protection along with the tax system must be used to close the gap between rich and poor. Social protections, when properly implemented, enable people to access education and employment and to escape the poverty trap that in many families is generational. This is one of the reasons it is important to allow welfare recipients to retain secondary benefits for a substantial period after accessing employment.

When compared with the appalling onslaught of last year's 16 welfare cuts on the most disadvantaged, this year's Social Welfare Bill seems almost generous. Last year's cuts have not been fully reversed as of yet. It is true some have been reversed and some have been amended but others have yet to be addressed, which the Minister acknowledged. The reality is that this State has had a buoyant economy for almost a decade and it is only now the needs of the most disadvantaged are even beginning to be addressed. Disgracefully, the years of economic boom have seen a rise in the levels of poverty in this State. Before addressing a number of issues in detail, it is important to point out the extent to which inequitable stealth taxes, which disproportionately impact on the less well off, have eaten into welfare increases and tax measures introduced in this year's budget.

The lack of child care provisions in the budget and the Social Welfare Bill is astounding. It is a damning indictment of the Government's real attitude to the issue of child care. Increases in child benefit are welcome but they are not adequate if this remains the Government's stated preferred method of assisting families with child care costs. Sinn Féin called for a child care supplement to be paid as a top up for child benefit for under five year olds and commend this proposition to the Minister once more. Sadly, this budget will do little to address the difficulties faced by parents to secure affordable child care. In regard to the crèche supplement, the Minister has stated that community welfare officers will be re-empowered to grant crèche supplement as judged necessary. We will have to see how this discretion is implemented but it is not the same as reversing last year's cuts.

Why was there no increase in the child dependant allowance? This targeted income measure is a particularly useful instrument in addressing child poverty and it is inexplicable that there has been no increase for the eleventh successive year. I am incredulous that this area was not addressed. Why was there no increase in the back to school clothing and footwear allowance? When one takes inflation into account, there clearly has been a decrease in real terms. The failure to increase this allowance is very disappointing when one considers the importance of keeping children in school, particularly those from disadvantaged areas. If parents cannot afford to buy the uniform, footwear and assorted necessities required at the start of the school term, the chance of children missing school days is increased.

I am concerned the impression has been given that the restrictions in regard to the rent supplement have been reversed. I am not convinced that is the case and I ask the Minister to address that in his response. What he has said is that he is willing to amend the criteria for eligibility for rent supplement to take into account those "who become ill or unemployed or are assessed by a local authority as having a housing need" in order that they are not disadvantaged. Greater clarity is needed in regard to this issue. The Minister must make the House aware of the contents of any revised guidance notes to community welfare officers on how these changes will be implemented and the extent of the discretion which the community welfare officers will have. Sinn Féin reiterates its call for the full removal of the six month restriction — anything less will fail to properly address the need. In the absence of its full removal, vulnerable people will continue to be put at increased risk of homelessness.

This brings me on to the dismal failure of the budget to address the issue of social housing. Social housing waiting lists are at an all time high. The budget measures in regard to stamp duty and first time buyers will mean nothing to those on low incomes and those reliant on social welfare whose only hope of securing a house is through social housing. Those people living in overcrowded conditions, in many cases, with three generations in the one house can see no light at the end of the tunnel. Single males who make up almost one third of those on local authority waiting lists have little hope of making the transition from emergency to permanent accommodation. Those working with the homeless, including Focus Ireland and Threshold, have long argued that an increase in the provision of social housing is key to eradicating homelessness and they have spoken of their disappointment with this year's budget. They have rightly accused this Government of ignoring people on housing waiting lists. Where the Minister has a direct input and a collective Cabinet input, I urge that he exercise himself to ensure that those who are in most need are given the greatest support.

Mr. Kelleher

I welcome the opportunity to speak on the Social Welfare Bill. That the Minister has received plaudits from the Opposition is an indication of his success in securing the largest social welfare package in the history of the State. I take umbrage with some of the points made by people opposite but, unfortunately, I will have to move the adjournment of the debate at 7 p.m.

I wish to deal with the very positive aspects of the social welfare provisions. Most people would accept that huge strides have been made to try to develop a socially inclusive society. We have removed those on the minimum wage from the tax net, which is a very positive step. The Fianna Fáil-Progressive Democrats Government introduced the minimum wage in the first place. People must accept that over the past seven years, this Government has been very socially inclusive. There was a reference to social protection. The best way to guarantee social protection is to ensure we have a vibrant economy with as many people as possible at work and to ensure they are taxed in a fair manner so that we can distribute the fruits of the economy to those who most need it.

Everyone will accept there have been major increases in pension payments. This Government has committed itself to ensuring that pensions will reach €200 per week. I am quite confident that will be achieved given the step this year and those which will be taken in the next two budgets. That is an indication of the Government's commitment to social provision.

In the broader context of social welfare, the economy and the taxation system, there is no doubt that over the past seven years, the Government has made a huge contribution to ensuring we have a low unemployment rate. Many people are coming here from abroad to secure employment. That is something which would have been unthinkable ten years ago. It is disingenuous for anybody to come in here, casually praise the social welfare increases in the budget and then highlight every negative thing without first acknowledging there have been major increases.

Child care is an issue which must be tackled on many fronts. The payment of child benefit is welcome but we must address the supply of child care. By increasing child benefit, all we are doing is driving up the price of child care, especially if there are not enough child care places available in the first instance. I urge all local authorities to expedite planning applications for child care and to alleviate some of the problems people experience when they apply for planning permission to change use of their houses to provide four to seven child care places. They must go to extraordinary lengths do so and very often they face objections not from residents, but from planners and from people outside the housing estate.

Debate adjourned.