Denis Naughten
Question:60 Deputy Denis Naughten asked the Minister for Social and Family Affairs the steps she is taking to reduce the cost of rent supplement to the Exchequer; and if she will make a statement on the matter. [40837/09]
Priority Questions.
Social Welfare Benefits.
Róisín Shortall
Question:61 Deputy Róisín Shortall asked the Minister for Social and Family Affairs the steps she will take to reduce the cost of rent supplement to the Exchequer. [40998/09]
I propose to answer Questions Nos. 60 and 61 together.
Rent supplement is payable to people who are unable to meet the cost of renting private accommodation and is intended as a short-term support. There are currently more than 91,600 people in receipt of rent supplement, an increase of almost 24% since the end of December 2008. It is essential to ensure that State support for rent supplemented tenants, who form a substantial section of the rental market, does not give rise to inflated rental prices with particular negative impact on those tenants on lower incomes, including people in low paid employment. It is also important to ensure that taxpayers' money is not being used to pay excessive prices to landlords.
To that end, the April budget provided for new maximum rent limits with effect from 1 June 2009 to reflect the general reductions in private sector rent levels. In order to bring the minimum contribution towards rent and mortgage interest supplement in line with payments required of local authority tenants, it was increased by €6, to €24 per week. Payments to existing rent supplement tenants were also reduced by 8% with effect from 1 June 2009.
The supplementary budget also provided for new arrangements for applications for rent supplement. To qualify for rent supplement, a person must now have been residing in private rented accommodation or accommodation for homeless persons for a period of 183 days within the preceding 12 months of the date of claim for rent supplement. A person may also qualify for rent supplement where the person is deemed by a housing authority to be eligible for and in need of social housing support.
The aim of this restriction on entitlement to rent supplement is to ensure that housing authorities remain the principal agents both for assessing housing need and for meeting the long-term housing needs of people. Community welfare officers have discretion to provide assistance where exceptional circumstances exist in any individual case.
My Department continues to work closely with the Department of the Environment, Heritage and Local Government in ensuring that rental accommodation scheme, RAS, meets its objective of catering for those on long-term rent supplementation while enabling rent supplement to return to its original role of a short-term income support. Trends in the private rental market are monitored on an ongoing basis and maximum rent limits will be reviewed in the light of a continuing drop in rental prices in recent months.
I thank the Minister. The savings target in this year was €50 million. How much has been saved to date and will the target be reached by the end of the year? Why has the Government failed so dismally to transfer people from rent supplement to RAS. Since 2005, 22,400 people have been transferred from rent supplement to RAS or to local authority accommodation. This is a damning indictment of the delivery of a stated commitment of Government. This is especially true in light of the fact that 32,600 people would be deemed eligible at this time. What is the Minister doing to ensure this happens and how are we in a situation where people are refusing to join RAS or refusing to move into local authority accommodation and staying in the rent supplement scheme?
There are two basic questions from Deputy Naughten, who I welcome to the portfolio. The savings outlined at the beginning of the year amounted to €48 million. Those savings have been achieved by virtue of the changes introduced. However, they do not show up on the bottom line of expenditure on rent supplement because demand has increased. The published Estimate for the year was €490 million but we will spend approximately €500 million by the end of the year.
Has the Minister already saved €48 million?
We have built savings of €48 million into that. The additional claims accounted for amount to €77 million. Unfortunately, it is one of those cases where there was an increase in demand.
Deputy Naughten's second question is central to reducing expenditure on rent supplement, which is to get people to move to RAS. The responsibility of local authorities is critical in this matter. We found that people were reluctant to move from private rented accommodation in a location of their choice to local authority housing. Since we increased the minimum payment that people must pay, finance is not having a deterrent effect. In some cases we found that people were paying less on the minimum contribution on the rent supplement than one would pay in local authority housing. We have removed this disincentive but it is something on which we are keeping a close eye. I work closely with the Minister of State at the Department of the Environment, Heritage and Local Government, Deputy Michael Finneran, on this issue because of its link with housing.
There is no evidence of the Minister working hard on this issue. Our questions concern how the Minister will reduce the cost of housing in terms of rent supplement. Unfortunately, very little progress has been made in this area and it seems the Minister is washing her hands of the matter. The Minister referred to savings made through actions taken in the past two budgets but she does not seem to get the point. Major savings can be made if more people transfer from rent supplement to RAS. Rather than wash her hands of this matter, as she did in the past two budgets, and place the onus on tenants — many of whom are vulnerable — by telling them to negotiate with their landlords, why is the Minister not taking responsibility for this and dealing with it on a State-wide basis by driving down rents? Is the Minister aware that Dublin City Council achieved savings of 16% on rents by negotiating directly? The council is in a powerful position and this should happen throughout the country.
Of all expenditure in social welfare, rent supplement is the greatest waste of money because it is dead money. It goes into the pockets of landlords and the State gets very little in return. There are currently 33,000 people waiting to avail of RAS. That system is much more beneficial in enabling them to go to work without creating poverty traps. It is much more beneficial to the State because of the potential significant savings that can be made. Why are some people waiting for this scheme and what steps has the Minister taken to enable a greater number of people to move from rent supplement to RAS?
In the April budget, when we reduced by 8% the rent supplement payment to all existing tenants, I was excoriated and people suggested this was far too penal. Now, I am told that others can make savings of 16%.
In an entirely different position.
It shows that people have been able to negotiate with landlords and have been able to get a reduction in rents.
The Minister is being disingenuous.
Based on CSO and PRTB figures, rents have reduced by 13% since January and a full 20% in the past 12 months. Even since we introduced the reduction, rents have reduced by another 3%. There is scope on this issue. Some 23,000 properties are available for rent so there is plenty of scope for people to negotiate, as they have done successfully. I am well aware of the Dublin City Council case because I saw it in the answer to a recent question. It has achieved savings in the rent it pays and if one is doing this on a wider level — paying to a landlord directly — of course one will be able to get those kinds of savings. The rent supplement is not paid directly to landlords; it is paid directly to the tenants who seek supplementary assistance. The responsibility for housing rests with the housing authorities and rents with the local authorities. We continue to put pressure on them to ensure this message gets across. This is why I referred to working with the Minister of State, Deputy Finneran. We want to transfer people out of rent supplement into RAS.
With 32,600 people on rent supplement over 18 months, the Minister is failing dismally to get people to transfer from rent supplement to RAS. If the Minister is working so closely with the Minister of State with responsibility for housing, Deputy Finneran, why did he introduce a long-term leasing initiative? Surely he should have put investment and support into rolling out RAS if that were the Government's priority. The fact is that public moneys are being squandered because of a lack of co-ordination between the Minister and the Department and the Minister of State with responsibility for housing. People are still not prepared to transfer from rent supplement and the Minister is failing dismally to deliver on that.
The responsibility for RAS and housing rests with the local authorities. The questions put by the Deputies are valid but I suggest that they table them for the relevant Department.
The Minister cannot wash her hands of that.
As far as I am concerned the more people who transfer the better as it saves on rent supplement. One cannot take two different attitudes in the same year to the same scheme. At the beginning of the year we were not doing enough to protect the vulnerable or giving enough to the poor unfortunate tenants. We were going to have them out on the street and homeless because of the changes we made. Now, Deputy Naughten is stating that it is dead money and we should finish the scheme for half the people on it.
The Minister is being entirely disingenuous in the way she is answering the question. What is more, she is showing that she has no grasp of the issue. If the Minister speaks to members of the Simon Community, Threshold or Focus Housing they will all tell her of the severe difficulties she has caused for people at the lower end of the market, the most vulnerable people in grotty bedsits who do not have the strength to negotiate with the landlords with whom they have legal agreements. The Minister took the soft option by forcing those people to take the hit on it; they are taking the hit personally rather than driving down rents. The Minister has no information at her disposal on the level of rents at the lower end and should stop spoofing about this.
Dublin City Council has shown that it is possible to achieve savings through the introduction of RAS. This could be done on a national level. In the past five years, the Government has spent €2 billion on rent supplement. That is an enormous amount of money. If the Minister could get 16% savings on that it would represent a massive amount. What is the Minister doing specifically to reduce that bill and to ensure more people have the option of going on RAS, given that there are 33,000 people waiting for it at present?
This year we have already decreased the amount of rent that was acceptable, therefore decreasing the amount of money paid to tenants to give to landlords and increasing the amount of money that tenants had to pay out of their own personal contribution.
Passing the buck to the tenants.
This helped to make savings this year. Earlier this year we accepted — Deputies were critical of the fact that we were putting such pressure on people — that——
Yes, of the way the Minister did it which was targeting tenants.
——for very many people it is only really possible to negotiate when their leases are up for renewal, which is on an annual basis. We anticipate more savings there. We are also actively examining the way in which rents are decreasing all the time. We will set new rent levels which will incur savings, bearing in mind differentials throughout the country and——
Why does the Minister not actively examine expanding RAS?
——for various groups, such as a single person having more difficulty than a family which is able to find a semi-detached house somewhere. I accept the principle that moving people out of rent supplement and into RAS is the best way to make savings.
Why is the Minister not doing that?
It is not principles we need, it is actions.
That is why I expect local authorities will increase their work in this regard——
What is the Minister doing about it?
——where it is their responsibility.
Social Welfare Appeals.
Denis Naughten
Question:62 Deputy Denis Naughten asked the Minister for Social and Family Affairs her plans to review the habitual residency condition rules or the existing legislation in view of the recent decisions of the appeals office regarding cases by asylum seekers; and if she will make a statement on the matter. [40838/09]
The requirement to be habitually resident in Ireland was introduced as a qualifying condition for certain social assistance schemes and child benefit with effect from 1 May 2004, in the context of the Government's decision to open the Irish labour market to workers from the new EU member states. The purpose of the habitual residence condition is to safeguard the social welfare system from abuse by restricting access for people who are not economically active and who have little or no established connection with Ireland.
A person who does not satisfy the habitual residence condition is not eligible for specified social welfare payments, regardless of citizenship, nationality, immigration status or any other factor. The social welfare schemes concerned are jobseeker's allowance, one parent family payment, disability allowance, carer's allowance, widow's and widower's non-contributory pension, guardian's non-contributory payment, non-contributory State pension, blind pension, supplementary welfare allowance except urgent or exceptional needs payments, and child benefit.
The five factors considered in determining habitual residence are: length and continuity of residence; length and purpose of any absence from the State; the nature and pattern of the person's employment; future intentions; and centre of interest such as family, home and connections. These factors, which were originally set out in European Court of Justice case law, were included in social welfare legislation by the Social Welfare and Pensions Act 2007.
The Department's guidelines regarding the application of the habitual residence condition to asylum seekers reflect a Supreme Court judgment which states, "persons who are allowed to enter the State for the purpose of making an application for asylum fall into a particular category and never enjoy the status of residents".
The Department is aware of the decisions of the chief appeals officer in a very small number of specific cases involving asylum seekers. Each decision of the chief appeals officer is made on the circumstances of the particular case and the decisions in cases related to certain asylum seekers do not automatically apply to all such cases. Since these decisions were made, there have been other cases where the appeals officer has upheld the decision to refuse a payment to an asylum seeker on the grounds of the habitual residence condition.
The appeals officer's decisions to award payment in a small number of cases are being examined within the Department to establish what, if any, implications they have for the operation of the habitual residence condition. A final decision has not yet been taken as to the appropriate response.
I thank the Minister for her reply. The sands have shifted on this issue as a result of an appeals officer's decision on four cases, and four more cases are to be decided upon. We have up to 20,000 people in the asylum and the leave to remain systems and if the other four decisions were to go the same way as the first four we could have an avalanche of applications being submitted to the Department through the appeals process. When does the Minister intend to make a decision on the legislation as it stands? It is being reviewed on foot of the previous decisions for the past month and every day that goes by could have implications for the potential cost of this.
I accept what the Deputy stated in regard to the implications of this. However, it is important to note that the appeals officer in making his decision dealt only with the legal arguments presented by both sides and did not set out a set of circumstances that should apply. Since his decisions on those cases, other decisions and refusals by appeals officers have been upheld. It does not follow that the decision he made is being applied to other cases. We are teasing through the legal implications and the knock-on effects on other cases. What was involved was child benefit but if the principle was established with regard to an asylum seeker then under certain circumstances with the habitual residence condition other schemes would be exposed also. This is why it is critical that we get the guidelines right.
Has the Minister had discussions with her colleague, the Minister for Justice, Equality and Law Reform? Is it not the case that if the Minister for Justice, Equality and Law Reform got his act together and processed these applications in an expeditious manner it would be very difficult for either asylum seekers or leave to remain applicants to meet the conditions as laid down in the habitual residency rules as they stand at present? Is it not case that the difficulty with the current interpretation of the habitual residency rules is the length of time that people have been left in legal limbo by the Department of Justice, Equality and Law Reform in the first instance and that is putting additional costs on the Minister's Department through the payments being made to people in direct provisions centres?
Officials in both Departments have been discussing this because of its import. There have been many cases on leave to remain and citizenship, but a previous Supreme Court judgment on the rights of people making applications for asylum found they do not have a particular status and that it has been deemed that provision made for them in direct provision meets all of our obligations as a country under the Convention on the Rights of the Child. The guidelines set down by the Department a couple of years ago were in keeping with that. It was a rather unusual decision by the appeals officer to interpret something in a way the Supreme Court did not. We and the Department of Justice, Equality and Law Reform are examining the five conditions for habitual residence rather than just one.
Social Welfare Code.
Róisín Shortall
Question:63 Deputy Róisín Shortall asked the Minister for Social and Family Affairs if she will give a commitment not to reduce the half-rate carers payment in Budget 2010. [40999/09]
Budget 2007 provided for new arrangements whereby people in receipt of a social welfare payment other than carers allowance or benefit who are also providing someone with full-time care and attention can retain their main welfare payments and receive a half-rate carers allowance. Similarly, people currently in receipt of a carers allowance who may have an underlying eligibility for another social welfare payment can transfer to that other payment and continue to receive up to a half-rate carers allowance.
The report of the special group on public service numbers and expenditure programmes made a range of recommendations relating to the Department of Social and Family Affairs, including on the half-rate carers allowance. The Department will consider the report's recommendations as part of the Estimates and budgetary process for 2010. Decisions on all the issues arising will be a matter for the Government. No decisions have been made on the implementation of any of the McCarthy proposals relevant to this Department. Full consideration will of course be given to the impact of the proposals on the recipients involved.
The Government is acutely aware and appreciative of the contribution made by carers to people needing ongoing care and support. In recognition of this, considerable improvements have been made in recent years in services and supports for carers. The payment rates for the carers allowance were increased further in the 2009 Budget by €7 to €239 per week for those aged 66 or over and by €6.50 to €220.50 per week for those aged under 66. Recipients of carers allowance are also eligible for household benefits, free travel and the respite care grant.
The means test for carers allowance has been significantly eased over the years and is now one of the most generous means tests in the social welfare system, most notably with regard to spousal earnings. Since April 2008, the income disregard has been €332.50 per week for a single person and €665 per week for a couple. This means that a couple with two children can earn in the region of €37,200 and qualify for the maximum rate of carers allowance as well as the associated free travel and household benefits package. A couple with an income in the region of €60,400 can still qualify for a minimum payment, as well as free travel and household benefits. These levels surpass the Towards 2016 commitment to ensuring those on average industrial earnings continue to qualify for a full carer's allowance.
From June 2005 the annual respite care grant was extended to all carers who are providing full-time care to a person who needs such care regardless of their income. The rate of the respite care grant was also increased to €1,700 per year in respect of each care recipient from June 2008.
It is estimated that the combined expenditure on carers allowance, carers benefit, the respite care grant and half-rate carers allowance will be €650 million in 2009. It would not be appropriate for me to comment further on budgetary proposals at this stage pending the outcome of these deliberative processes.
I asked the Minister for a commitment not to reduce the half-rate carers allowance. The Taoiseach and several of her colleagues have already given a commitment to the wealthy that they will not be taxed further. If that kind of commitment can be given to people who are very well off, I do not know why she cannot give a commitment on the additional payment of just over €100 to those who provide care around the clock to family members.
I was disappointed that she did not take up the invitation by the Carers Association to visit a carer. I accompanied several colleagues from this House on a visit to a woman who is minding her 17 year old disabled son around the clock. She receives the lone parent payment and the half-rate carers allowance. How can this woman and the thousands of other people in similar circumstances possibly sustain a 33% reduction in their income and continue what they are doing? Does the Minister not accept it would be a false economy to cut the allowance?
I fully appreciate the valuable role played by carers. All of us visited people who are being cared for as well as their carers, including both those who receive no support from the State and those in receipt of the carers allowance. I have met groups representing carers, including in particular the Carers Association, on several occasions at local, county and national levels. We are conscious of the issue, therefore.
As the Taoiseach noted this morning, the social welfare budget of €21 billion constitutes more than one third of total expenditure. We cannot ignore this expenditure in the context of the forthcoming budget. Equally, however, it is not possible at this stage to go through the various elements of the budget and decide what we will cut because that would not be fair to the groups who are not being discussed today. No final decision has been made in respect of any element of the social welfare budget because cutting social welfare payments is the last thing anybody wants to do. However, we have to somehow reduce the budget. It is not the first area we will rush into when dealing with the budget but I cannot give the commitment the Deputy desires.
We know that approximately €8 billion in tax reliefs are available to the better off. Why can commitments be given to those people? It is easy for the Minister to say she values carers but if that is the case she will not hit them financially. I am asking her to give a commitment not to reduce the half-rate carers allowance, which has a ceiling of just over €100 per week. Does she accept this money is needed in households, not in recognition of the huge time commitments given by carers but to cover additional demands in respect of heating, lighting, dietary requirements and, in many cases, cleaning? The allowance is used to subsidise the additional costs involved in caring. Given the significant concerns held by thousands of carers throughout the country that their incomes will be cut, I ask her to put their minds at rest by giving a commitment that she will not hit them.
The Deputy referred to the extra demands that arise in regard to care recipients. I appreciate that somebody with a severe disability has additional heating and dietary requirements but it does not necessarily follow that carers need additional money.
That is where the money is going.
In many cases carers do not live with the care recipients.
In many cases they do.
The data on the half-rate carers allowance reveal the commitment of older people. Of the 19,000 people in receipt of the allowance, 7,500 are in receipt of the State or invalidity pension, 2,000 are in receipt of disability benefits and 3,500 receive lone parent benefits.
What point is the Minister making?
It is interesting to look at the profile of carers.
They are enabling other people to stay out of nursing homes.
I have outlined the significant improvements that have been made not only to rates of pay but also in terms of free travel and household benefits for carers. They also have generous income disregards.
Every single group would like my commitment to leave them alone in the budget but the next group will then ask for the same treatment. I am aware people are anxious and want reassurance but it is genuinely not possible at present to promise our full protection to any group affected by the social welfare system.
Seymour Crawford
Question:64 Deputy Seymour Crawford asked the Minister for Social and Family Affairs if she has advised her inspectors at local level that they are to accept the current economic situation of self-employed persons or those applying for farm assist; her views on whether many of these persons are in a critical situation at present; and if she will make a statement on the matter. [40831/09]
Jobseekers allowance and farm assist are both means tested payments. In such cases, a social welfare inspector interviews the claimant and makes such inquiries as are necessary to ascertain the means of the applicant. Historically self-employed persons were assessed on the basis of their income in the 12 months prior to claiming and a decision was given on that basis. In the context of relatively stable economic conditions this proved an effective measure of means. However, it was always open to an applicant to make a case showing that his or her income in the coming 12 months was likely to be greatly reduced in light of personal or economic circumstances. The Department's inspectors and deciding officers would take account of this and in assessing means would exercise their best judgment as to the likely income a person would receive in the 12 months following the claim
In light of the changed economic environment and recognising that the system of using past year earnings as a basis for assessing means was no longer as equitable as heretofore, the Department issued a circular in May 2008 advising inspectors of the changed economic circumstances and the need to recognise that less would be available to claimants in the foreseeable future. Inspectors were advised that each case should be examined on its merits and they should apply their knowledge of local conditions to arrive at a fair assessment of the income from self-employment in the coming 12 months. Where a self-employed person's circumstances change after he or she has made an initial claim for jobseeker's allowance or farm assist, he or she can apply to have his or her means reviewed. In addition, it is open to the individual, if he or she is dissatisfied with the means assessed, to make an appeal to the social welfare appeals office. In the meantime, it is important to remember that people who have urgent income support needs can apply for the means tested supplementary welfare allowance, SWA, and more than 95% of basic SWA applications are decided on and paid within one week.
I appreciate the need to ensure claimants who have been self-employed and whose income is significantly affected by the economic downturn receive their full and fair entitlements in a timely manner. I assure the House that the Department is doing its best to ensure this objective is achieved.
While I appreciate the Minister's reply, it does not reflect the position on the ground. I was advised by a social welfare inspector in the past week that he was not aware that current rather than historical income should be taken into account. For example, I am aware of a young couple with two children who received a farm assist payment of only €6.50 based on their income for last year rather than this year. Is that fair?
Is it fair that a couple whose file was dealt with by the deciding officer was paid €3.61 per week for two weeks only to have the payment withdrawn by the local inspector who refused to accept current rather than past income? Does the Minister realise that if this issue is not addressed, many farming families and self-employed people who were earning good money until last year will face serious problems? One individual who employed ten people until 14 or 15 weeks ago when he encountered financial problems as a result of external factors cannot obtain one cent whereas his ten former workers receive jobseeker's allowance.
A clear circular was issued to social welfare inspectors in May 2008 reminding them that they should have due regard to the likelihood that individuals' income was likely to fall and they should assess current rather than last year's income. The system appears to be working reasonably well in other areas because the number of self-employed people on jobseeker's allowance stands at more than 6,600 while the number of people in receipt of farm assist payments has increased to 8,600. People are, therefore, continuing to benefit from the scheme, which was the intention behind it. The specific cases referred to by the Deputy are being reviewed.
I do not doubt the Minister. She provided a straightforward answer to a question I put to her in committee last April. At the time, she advised me that a circular would be issued and that has been done. I ask her to ensure that full information is being used on the ground. At a meeting with representatives of the Irish Farmers Association in the past hour, I was told in no uncertain terms that while the system is working well in some areas, it is not working in others. A blitz is needed. Many farmers are losing income as a result of developments in disadvantaged area payments, REPS and so forth. Thousands more will be affected if this matter is not properly addressed.
I appreciate the issue the Deputy has raised. It is important that decision making is consistent across the country, particularly in the area of means tested assessments. The Department issues circulars to ensure inspectors at local level know precisely what they should take into account. I will ensure that the next meeting of inspectors is reminded of the need to apply the provisions of the circular on the self-employed and applicants for farm assist in a consistent manner.