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Dáil Éireann debate -
Tuesday, 29 Jun 2010

Vol. 713 No. 4

Other Questions

Social Welfare Payments

Noel Coonan


37 Deputy Noel J. Coonan asked the Minister for Social Protection the number of persons in receipt of mortgage interest supplement; the cost for same; if he will arrange for the collection of figures on the number of persons who apply for mortgage interest supplement; and if he will make a statement on the matter. [27903/10]

Joe Costello


44 Deputy Joe Costello asked the Minister for Social Protection the way he intends to reform mortgage interest supplement. [27976/10]

Paul Connaughton


45 Deputy Paul Connaughton asked the Minister for Social Protection if he will provide details on the review of the mortgage interest supplement scheme; the changes envisaged under this review; if he will publish the report; and if he will make a statement on the matter. [27900/10]

Olivia Mitchell


58 Deputy Olivia Mitchell asked the Minister for Social Protection his plans to amend the mortgage interest supplement scheme; if he will make revised guidelines publically available; and if he will make a statement on the matter. [27944/10]

Róisín Shortall


421 Deputy Róisín Shortall asked the Minister for Social Protection when and the way in which he intends reforming mortgage interest supplement. [28508/10]

I propose to take Question Nos. 37, 44, 45, 58 and 421 together.

There are 16,800 people in receipt of mortgage interest supplement, compared to 8,000 recipients in 2008. Expenditure for the year ending December 2009 was €60.7 million and the Estimate for 2010 is €63.9 million.

Generally, all applications for mortgage interest supplement are recorded electronically. However, as this practice can vary across community welfare areas, full statistics for the number of people who applied for mortgage interest supplement are not available. Community welfare officers have been reminded on many occasions to record the details of receipt and status of all claims electronically. However, requests to change operational procedures must be viewed in the context of the increased demands being placed on community welfare officers in the current economic environment.

The mortgage interest supplement scheme is currently under review. The main purpose of this review is to examine how the scheme can best meet its objective of catering for those who require assistance on a short-term basis. The review group includes representatives from my Department, the community welfare service, the Departments of Finance and the Environment, Heritage and Local Government, and the Office of the Financial Regulator. As part of the initial review, guidelines on specific and immediate operational issues were drawn up and circulated to the community welfare officers. These guidelines are available on the Department's website at

The group is examining trends in programme and administrative costs, the impact of the Financial Regulator's statutory code of practice on mortgage arrears and legislative and operational issues arising. The review is also considering whether alternative approaches to achieving the scheme's objectives are warranted in the light of recent changes in the economic climate and the mortgage market.

More recently, the Government has established a broader and more comprehensive review of mortgage arrears and personal debt. The mortgage arrears and personal debt review group, under the independent chairmanship of Mr. Hugh Cooney, comprises representatives from my own Department, the Departments of Finance; the Taoiseach; the Environment, Heritage and Local Government; Justice and Law Reform; and Communications, Energy and Natural Resources. In addition the group has representatives from the Office of the Financial Regulator, the ESRI, the Irish Banking Federation, the Free Legal Advice Centre and the Law Reform Commission.

The terms of reference for the group are based on the renewed programme for Government, with an emphasis on protecting the family home. They include a review of the statutory code of conduct on mortgage arrears and the recently agreed protocol between the Irish Bankers Federation and the Money Advice and Budgeting Service on debt default, with a view to expanding the options available for dealing with debt situations to avoid foreclosure. In addition, the group is examining measures adopted in other jurisdictions and considering ways of expanding existing mortgage-support measures. The group will report to the Minister for Finance in the coming weeks. The conclusions and recommendations from the review of the mortgage interest supplement scheme, which is currently being finalised, will inform the work of this group.

This is just repetition.

My first question concerned the collection of figures on the numbers applying for mortgage interest supplement. In the past, there have been difficulties getting figures for those who apply and those who have been refused. I am concerned about the different ways this is operated. The Minister says guidelines have been sent out, and perhaps they have, but I am still getting different responses as to why people are being refused and the length of time for getting it in some places. There does not appear to be any clear operation of this across the community welfare service.

When the Minister gets the report in the next few weeks, will there be changes in the operation of mortgage interest supplement? I do not know what will be in the report, but there are problems here that need to be tackled.

Has the Minister any view on the way the financial institutions are using the mortgage interest supplement? I have had people come to me who tell me the bank has told them it will not foreclose if they get mortgage interest supplement. When they are refused mortgage interest supplement, the banks treat them more harshly, although it was the bank who gave them the loan in the first place. The community welfare officer decides that person should never have got the loan, which is great with hindsight, but it leaves people in a difficult position. Has the Minister discussed this with the Minister for Finance? We are guaranteeing the banks but they are treating people harshly.

I spoke to the Minister for Finance in a general way about this issue. I also spoke to Mr. Hugh Cooney about it. It is important that the benefit of the mortgage interest supplement is to the mortgage holder. Many parties have a part to play in resolving this; the banks lent the money and in some cases they did less than their homework before doing so. We have all come across such cases. l have noted the Deputy's remarks about the uniform application of the scheme and it is important, as far as possible, that there is uniform applications of the rules. Different referees interpret the rules differently, however, and no matter how rules are codified, different interpretations are possible. I will discuss this further with my officials to see if there are any further ways to ensure that.

Without pre-empting the report, the beginning of resolution to a person's debt problems, if he is in serious difficulty and his problems cannot be resolved by meeting with the bank, must be a meeting with MABS to work out the total financial situation independently. Otherwise the situation the Deputy mentions arises.

The Minister's general response to the issue seems to be that someone somewhere should do something. The Minister is in the position to act here and instead of reading out long answers, it would be better to engage in the topic and tell us what he intends to do rather than hiding behind prepared answers and talking about the Cooney report. It is ludicrous that we do not know how many people apply for mortgage interest supplement. That is a major gap in the information systems that should be addressed now.

The mortgage interest supplement scheme has not been reformed since the mid-1990s. It does not reflect the reality of the boom and post-boom years. We now have a situation where many people, some of them on very low incomes, are being refused any kind of assistance under the scheme because of the arbitrary nature of the rules that apply. Leaving aside the Cooney report, the Minister is responsible for the review of the mortgage interest supplement scheme. That review was supposed to be ready at Easter 2009, then Easter this year and it is now 15 months overdue. When does the Minister expect to get it? The delay means more people will be in serious danger of losing their homes. Let us have some action.

I agree that we need action but it must be taken in a focused way. As I indicated to Deputy Enright, I expect the Cooney report in the next few weeks and the mortgage interest supplement report will be available at the same time because they are linked together inextricably.

What does that mean, inextricably linked? Is the review complete and does the Minister have a copy of it?

I do not have a copy but I understand it is almost complete. I hope to have a copy in the next few weeks.

What did the Cooney group get from the Department?

It is getting everything we have. Everything we are looking at in the mortgage interest supplement report will be available to it. It would be a nonsense otherwise.

How can matters be meshed if there are not two separate reports?

I will call on both Deputies again but I want to allow a further supplementary from Deputy Seymour Crawford.

Many people are under severe pressure at present. They do not want reports or debates, they want action. Huge amounts of money have been paid into the banking system. What benefits do ordinary punters receive from that major investment which we have made as taxpayers? It does not seem that ordinary people who have a mortgage that is now overdue receive the support to which they should be entitled. I encourage the Minister to do something to make it worthwhile.

I am not sure whether a question was asked.

I think the question was on when it will all happen. We have two reports and I hope that——

No, we do not have two reports.

Allow the Minister to answer.

Two reports are being prepared, which we should have in the next few weeks. The process will be quite simple. We will receive the two reports, the Government will consider them and then make decisions on foot of them. Those decisions, to be made not by me but by the Government, will be made in the next few weeks, once we receive the reports. However, I cannot — which the Deputy wants me to do today — tell her the decisions. I have not seen the reports and therefore I cannot make decisions on them. Of course I have my views on what should happen and I will bring them to the Cabinet table. I share with everybody in the House concern about protecting the family home. If I understand the tenor of Deputy Crawford's question, I believe the banks must be part of the solution and I also believe that MABS, in laying out and ascertaining the amount of debt in the first place and working out a financial plan, has a key role to play as a free State-provided service that is very professional.

I want to allow a brief supplementary from each spokesperson.

Will the Minister please focus on the review that is now 15 months overdue? He speaks about being concerned about people in danger of losing their homes but he allows this matter to drift so there is an inexcusable delay in producing the review. Stop confusing this with the wider issues on debt, and there is no doubt that big problems exist. I am asking about the specific review undertaken. What is the reason for the delay in that? When does the Minister expect that review to be complete? When can we see a copy of it?

I came to the Department at the end of March and have been there for three months. We hope to have the review completed in the next few weeks.

When will it be ready?

In the next few weeks.

We have been told "the next few weeks" for the past 15 months.

Allow the Minister to answer the question.

Most people would accept that "the next few weeks" means from two to four or five weeks.

The difference is that we have been told "the next few weeks" for the past 15 months.

Allow the Minister to answer please, Deputy Shortall.

There is no sense of urgency at all on this issue.

I will try to be more specific. I hope it will be in the next month.

We were told that——

In the English I use on the east coast and west coast, "the next few weeks" means "the next month". If Deputy Shortall would find "the next month" more satisfactory, I will say "within the next month". This will mean that within four months of my arrival at the Department, this matter will be brought to finality. Not only are we bringing the mortgage interest supplement review to finality, which is only part of the jigsaw, we are also bringing the Cooney report to finality and making decisions.

We will wait and see.

By making decisions on both we will be able to give a comprehensive response. I might be wrong but I do not believe the mortgage interest supplement review on its own would answer the major debt problems that people face because——

Nobody is saying that.

Good. I am glad.

The Minister should stop putting up straw men. The Minister was asked——

Allow the Minister to answer the question. I want to allow another supplementary from Deputy Enright.

It is not the fault of struggling home owners that for various political reasons we have had four different Ministers at the Department in the past five years. The fact the Minister has been in the job for only three months is no excuse for the fact that there has been no action on this since the review group was established more than three years ago. Forget about that. The Minister used it as an excuse on the previous occasion also and I do not know how many homes have been repossessed in the meantime. It is not their fault that the Government has changed ministerial portfolios so often.

The Minister is concerned with the issue of overall debt, as are we all. If this is the case, why has the Minister not changed the regulations to allow community welfare officers take overall household debt into account when granting mortgage interest supplement? They cannot do so. If a person has a mortgage, some of which is based on a house and more based on an amalgamation of debt, he or she is not allowed receive mortgage interest supplement on the amalgamation of debt part but only on the part which funded the purchase of the home. If the Minister is concerned about this why does he not deal with it?

The simple answer is that we are dealing with it. However, many issues must be examined and that is why the Cooney group and the mortgage interest supplement review were established.

The Cooney group was established because Deputy Eamon Ryan announced it.

Both of these will be brought to a conclusion in the next few weeks, or in other words, in the next month, and we will then make decisions. It is better to tackle a problem by doing a comprehensive review, examining practices in other jurisdictions, making comprehensive proposals——

Delay, delay, delay.

——and making decisions. One can rest assured that those decisions will be made because this is a top priority.

What happens in the meantime?

Reviews do not have to be so long.

Social Welfare Appeals

Leo Varadkar


38 Deputy Leo Varadkar asked the Minister for Social Protection the average time it took to process social welfare appeals in 2009; and if he will make a statement on the matter. [27931/10]

Aengus Ó Snodaigh


67 Deputy Aengus Ó Snodaigh asked the Minister for Social Protection the current average and longest waiting times, respectively for the outcome of appeals against decisions to refuse supplementary welfare allowance [27964/10]

I propose to take Questions Nos. 38 and 67 together.

I am informed by the social welfare appeals office that 26,000 appeals were received in 2009. This compares to the average number received over the previous four years of 15,000. At the end of 2009, 16,000 appeals were on hand and that figure has now risen to 20,300. In previous years, that number would have been in the region of 5,000 to 6,000.

I understand that during 2009, the average time taken to process all appeals, that is those decided summarily and by way of oral hearing, was 24 weeks. However, if allowance is made for the 25% most protracted cases, the average time falls to 15.8 weeks. This represents an increase of two weeks in the time taken to process appeals when compared to 2008.

Supplementary welfare allowance is a payment of last resort and, therefore, appeals for this scheme are given priority by the social welfare appeals office. The average time for processing these in 2009 were 6.5 weeks for cases dealt with on a summary basis, and 10.5 weeks where an oral hearing was required.

During 2010, changes have been made to the organisation of an appeals officer's work with a view to having a greater number of appeals dealt with by way of summary decision and in a more speedy fashion. As a result of these changes, the average time to deal with summary decisions on supplementary welfare allowance cases has reduced to 4.7 weeks, while the time taken to deal with oral hearings for this scheme has increased to 13 weeks.

While the significant growth in the number of appeals is clearly impacting on processing times, it must also be remembered that the processing time for appeals covers all phases of the appeal process, including the submission by the Department of its comments on the grounds for the appeal, further examination by the Department's medical assessors in certain appeal cases and further investigation by social welfare inspectors where required. Circumstances may also arise where further information is sought from the appellant. Delays can also occur where the appellant submits new information or evidence, often at an advanced stage in the proceedings. In some cases adjournments may be sought by appellants or their representatives.

A number of initiatives are under way which are designed to enhance the capacity of the office to deal with the current caseload and inflows. In that regard, two additional appeals officers were assigned to the office in 2009; a number of additional staff are being assigned to the administration area of the office; the organisation of the work of the appeals officer has been changed so as to increase productivity; a project to improve the business processes in the office is under way and a number of improvements have already been implemented; and significant enhancements are being made to the office's IT and phone systems.

Notwithstanding these measures, it is clear that additional staff are required in the short term to address the backlog that has developed. It has been decided to use experienced retired staff strictly on a short-term basis to supplement the current resources and the services of eight retired officers have now been secured on a part-time basis. To facilitate this initiative, the Social Welfare (Miscellaneous Provisions) Bill 2010, which is on Committee Stage, includes an amendment to allow these retired officers to decide appeal cases. The chief appeals officer is closely monitoring the situation.

Whoever wrote that answer should leave the Civil Service and get a job as a spin doctor. I asked a question on the average processing time. The Minister then said if one takes out the most protracted cases it is not as bad as it looks. The Minister gave us the figure for the overall average processing time, which is the issue. The protracted cases are part of the problem. The Minister cannot take them out and then tell us things are not as bad as they look because they are.

Which payment types attract the most appeals? Are they also the ones which are the most successful? For example, what percentage of carer's allowance appeals are successful? The Minister pointed out yesterday on Committee Stage of the Social Welfare (Miscellaneous Provisions) Bill that only 2% of cases are appealed. My concern is that almost 50% of appeals are partially successful or are successful. That means there is a real problem with the initial decisions which are made. Sometimes more information is provided, but we need to have a system in place which ensures that people know what information to give in the first place.

I have a lot of information here but unfortunately I do not have information on that aspect. It is available in the appeals office report, a copy of which I am sure the Deputy has seen. I have examined this a few times. Off the top of my head, means tested cases tend to be a large number and are protracted. Medical cases apply to carer's allowance, illness benefit and so on. It is fair to say that the shortest cases involve things like whether the person concerned has enough contributions because they tend to be fairly black and white.

I referred to payment types, such as carer's payments or jobseeker's——

If one considers payment types one probably finds that those with the largest case load are assistance payments, carer's allowance, unemployment assistance and so on, and illness cases. One could be eligible for illness benefit as well as disability allowance but means testing always applies to assistance cases.

The average processing time for social welfare appeals is now 24 weeks, almost six months. Unlike delays in other areas such as the passport office, getting redundancy payments and so on, delays in social welfare appeals are costing the State money because some 40% of appeals are disallowed and in the meantime people receive a payment.

That is not necessarily true.

They receive a supplementary welfare payment in most cases.

In most cases it is true, and the Minister gave us that reply when we asked about it.

Allow the Deputy to put the question, Minister.

At a conservative estimate the delays in processing social welfare appeals is probably costing the State approximately €10 million per year. What is the Minister going to do about that? He told us he will take on part-time retired social welfare appeals officers, which amounts to three additional staff in the office. Why is the Minister not making the case to the Minister for Finance that recruiting more staff for the appeals office would result in savings to the State? These delays are costing the State dearly. Why does the Minister not present a business case to the Minister for Finance and let him know that by recruiting the additional staff that are necessary he will be saving the State money?

It is not just a question of the number of appeals officers; a lot of other issues and fronts are involved. We have appointed extra appeals officers and are taking on temporary ones. Medical officers are an issue because in some case medical examinations are involved.

The Minister is appointing three extra officers. That will not deal with the problem.

That is only a small part of the issue. For example, as the Deputy is probably aware, in a lot of cases where further information is provided there is a short circuit system which goes back to the Department. The Deputy can be assured that I will be working with the appeals office to try to address this issue on all fronts, including information technology, better work methods and so on. I am determined to rapidly decrease the amount of time it takes to process appeals. Deputy Enright made a very valid point in asking if there was any way we could reduce the number of appeals in the first place and have our decision making process such that fewer people would feel they wanted to appeal. That is the first step in the whole process. We will work through every step to try to make it more efficient and deliver a better service.

Written Answers follow Adjournment Debate.