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Dáil Éireann debate -
Wednesday, 24 Nov 2010

Vol. 723 No. 1

Social Welfare (Miscellaneous Provisions) (No. 2) Bill 2010: Second Stage

Tairgim: "Go léifear an Bille an dara huair."

In the current economic and financial crisis the Government's main priorities must be to restore stability to the public finances and to deal with the jobs crisis. Tá an Rialtas bródúil as an méid atá curtha i gcrích le dhá bhliain déag anuas chun leibhéal na n-íocaíochtaí leasa shóisialaigh a mhéadú go mór, ar mhaithe na ndaoine. Le dhá bhliain déag anuas, d'ardaíomar muid na rátaí pinsean faoi 120%, mhéadaíomar na híocaíochtaí dífhostaíochta 130% agus cuireadh feabhas de níos mó ná 330% ar na híocaíocthaí do shochar leanaí.

The Government is proud of its unrivalled record in increasing the level of social welfare payments. Over the last 12 years, we have increased pension rates by approximately 120%, unemployment benefits by almost 130% and child benefit payments by over 330%. The cost of living has increased by approximately 40% over the same period. We extended coverage, removed barriers and increased entitlements such that the level and extent of social support payments has been transformed beyond recognition. Continuing to reflect the trend of recent years and reaffirming Government's commitment to all those in need of support, €20.9 billion will be spent by the Government in 2010 on social welfare provision — some €500 million or 2.45% more than 2009.

Social welfare expenditure for 2011 will be considered in the context of the forthcoming budget having regard to both the needs and to the resources available to meet those needs. In an uncertain economic environment, the priority will be to ensure that the Government strategy to stabilise the financial position is advanced in order to protect those most in need in a manner which is sustainable in the years ahead.

Nuair a thosaigh mé mo chuid oibre mar Aire Coimirce Sóisialaí, chuir mé in iúl go raibh i gceist agam a bheith i m'Aire a dhéanfadh athchóiriú ar an gcóras agus ar ndóigh bhí sé sin leagtha amach ag an Taoiseach dom ó thaobh na gcúraimí a bhaineann le tacaíocht ioncaim, seirbhísí fostaíochta agus gníomhachtaí oibre uile a lonnú in aon Roinn amháin agus in aon sheirbhís uile-ghnéitheach amháin. Is céim eile chun cinn san obair seo é an Bille seo. When I started my work as Minister for Social Protection, I said that I intended to be a reforming Minister and that task was set out for me by An Taoiseach in terms of integrating the functions around income support, employment services and work activation together in the one Department and in one comprehensive service. This Bill marks another step forward in that direction. I would now like to outline some of the main provisions in the Bill.

This Bill provides for the full transfer of the employment services and community services programmes of FÁS from the Minister for Education and Skills to me as Minister for Social Protection. It also provides for the integration of FÁS staff with the Department of Social Protection. This process was initiated by the Social Welfare (Miscellaneous Provisions) Act 2010. As Members of the House will recall that Act provided for the transfer of policy and funding responsibility for the employment and community services of FÁS from the Minister for Education and Skills to my Department. The practical arrangements to support this transfer of functions are now largely in place and it is intended to commence the relevant provisions of that Act with effect from 1 January 2011. From that date, FÁS will continue to provide employment and community services as it does now but under my direction and reporting to my Department. I should say that FÁS and my Department are already working closely together and considerable progress has already been made on a number of measures to enhance the delivery of services to people on the live register.

This Bill provides for the transfer of the relevant staff and resources such as buildings from FÁS and their full integration with the staff and structure of my Department. FÁS will also cease to have any role in the provision of employment and community employment programmes and will focus on the provision of training services. As a result the Bill will enable one of the most radical realignments of social welfare provision in the history of the State. The employment and community services of FÁS will not simply transfer but will be integrated fully with the Department to provide an end to end service to our customers. This will allow a transformational overhaul of service provision for people of working age. As well as income support, we will now focus our interventions on assisting people in finding employment and to prepare for entry into the labour market by accessing training, career advice, work experience and job placement.

My Department is already working closely with the senior management of FÁS and the Department of Education and Skills to develop a new service vision and model for the integrated Department. While still at an early stage of development the main outline of that vision is clear; it will be customer-centred and employment focused. The main objective will be to ensure that all people of working age are given the support they need to find employment as quickly as possible or to develop the skills and aptitudes required to progress towards employment by undertaking appropriate education, training or work experience. This objective will be supported by a case management approach allowing suitably trained staff to interact on a one-to-one basis with individuals on developing pathways to employment with clearly defined milestones and targets.

The integration of FÁS employment and community services with my Department marks an important step away from a passive model of income support to a proactive model which is clearly focused on progressing people to participation in the workforce. Such an approach not only makes economic sense but also allows our services to be tailored to meet the individual needs of each customer and to respect and enhance their dignity as individuals. The restructuring of these areas is part of the Taoiseach's plan to deal with job creation, work activation and income supports in a better and more cohesive way. This initiative is a tangible example of public sector reform facilitated by the Croke Park agreement.

Currently, in order to qualify for jobseeker's benefit or jobseeker's allowance, the jobseeker must fulfil a number of conditions, including being available for and genuinely seeking work. To fulfil these conditions, jobseekers must at regular intervals make a declaration that they are still unemployed, available for and actively seeking work. This is what is called the certification process or "signing on" and is currently carried out by the jobseeker going to their social welfare local office. One of the provisions I am including in this Bill will be allow certain people who receive jobseeker's allowance or jobseeker's benefit to complete the certification process by electronic means. We will be changing the current signing process in our local and branch offices to collect signatures via a digital signature pad and we are exploring the possibility of using electronic channels for certification such as online through the Internet or by using the mobile telephone. These new channels are being introduced to enable us to carry out the certification process more efficiently, while at the same time delivering better customer service and maintaining the necessary levels of control inherent in the current manual process. We are engaged in a project to examine the potential to develop an additional channel for jobseekers certification via the mobile telephone.

Before committing to full-scale deployment, the mobile telephone certification solution has to be evaluated by the Department from both a business process and technical perspective to test how it will work in practice to ensure necessary levels of security and control. Deployment will not proceed unless this solution offers a sufficient level of control in line with existing processes. The project is scheduled to conduct a live trial at end January 2011 in which a number of customers will be invited to participate. The selection of customers to be invited has not yet been finalised.

This mobile telephone facility is intended to be made available on a risk assessment basis and will have high levels of control built into it. Customers will be invited to use the channel and it will not be generally available on request.

It is anticipated that cost savings will accrue from reducing the effort required to certify jobseekers at the Department's local offices. As a result, staff resources will be freed up and will enable the Department to concentrate on client, claim, payment and control issues. Further, it is expected to reduce pressure on local office facilities and accommodation.

I am also introducing a provision in the Bill which requires that from 1 January 2011, before rent supplement can be awarded to new claimants, the landlord's tax reference number must be supplied to the Health Service Executive. Landlords of existing claimants will be requested to supply their tax reference number at the time of their next rent supplement review.

The Government wants to ensure that where tenants are in receipt of the State's rent supplement, the landlords of the premises in question are fully tax compliant. If they are tax compliant they should have no difficulty providing the reference number. The new rent supplement provisions also provide that a landlord will be obliged to provide his or her tax reference number or confirmation that he or she does not have a tax reference number in respect of each tenancy for which a rent supplement is payable.

As I indicated, where rent supplement is in payment immediately before 1 January 2011 and this supplement continues to be claimed immediately after that date in respect of the same tenancy and where the landlord has not supplied his or her tax reference number before 1 January 2011, rent supplements will continue to be paid until the review date for the supplement. At that stage, the Health Service Executive will request the landlord to supply his or her tax reference number. To avoid unnecessary hardship the Bill also allows for the further continuation of the rent supplement beyond this date to allow a reasonable time for the landlord to respond to the HSE's request to provide his or her tax registration number and also to avoid tenants being penalised by having to break an existing tenancy agreement.

A rent supplement cannot be paid beyond 31 March 2012 in any case where the landlord has failed to provide his or her tax reference number. The Bill also makes it an offence for a landlord to fail to provide the information requested.

I will now outline the main provisions of the Bill. Section 3 clarifies the provisions for the calculation of the duration of payment of illness benefit claims. Section 4 provides for the use of electronic means of making and capturing the declarations of unemployment that are required for the purposes of claiming jobseeker's benefit and jobseeker's allowance.

Section 5 clarifies the calculation of entitlement to jobseeker's allowance where weekly means comprise earnings from insurable employment. In determining a week of unemployment — three days of unemployment, consecutive or not, in any six consecutive days — the practice is to include a day only once in any computation where that day is part of a week of unemployment in respect of which jobseeker's allowance is paid. This section, which amends section 141 of the Social Welfare Consolidation Act 2005, ensures the Act is not ambiguous as regards applying this practice.

Section 6 provides that the reduction in the basic rate of supplementary welfare allowance from 4 January 2010 for people under 25 years will not, of itself, lead to any reduction in rent or mortgage interest supplements payable to people receiving other social welfare payments.

Section 7 provides for a new condition for the rent supplement payable under the supplementary welfare allowance scheme which requires that from 1 January 2011, before a claim for rent supplement can be awarded, the landlord's tax reference number must be supplied to the Health Service Executive. As certain landlords will not have such a tax reference number, for example, non-resident landlords, confirmation from the landlord to that effect is required to be supplied in such cases. This section also provides that a landlord will be obliged to provide his or her tax reference number or confirmation that he or she does not have a tax reference number in respect of each tenancy for which a rent supplement is payable.

Section 8 clarifies the position with regard to the information to be provided by or in respect of a customer registering for a personal public service, PPS, number. Section 262(3) of the Social Welfare Consolidation Act currently requires that a photograph and signature be submitted for any customer registering for a personal public service number. However, it is not practical to collect these items in all cases, for example, where the customer is non-resident or deceased or in probate cases. Section 8 clarifies the position by only requiring that these items be submitted when required. The section also provides that providing additional security information will become a compulsory part of the registration process for the purposes of allocating and issuing PPS numbers.

Section 9 is a technical amendment to change references in the Social Welfare Consolidation Act and in other enactments from "public service card" to "public services card" to reflect the de facto position. There is a reference to “public service card” in the Criminal Justice (Theft and Fraud Offences) Act 2001 and this section also provides for a textual amendment to change this reference to “public services card”.

Section 9 also makes a number of changes to the current provisions relating to the public service card under section 263 of the Social Welfare Consolidation Act and the social services payment card under section 264, including clarifying that both the social services card and the public services card can be used for the purposes of paying social welfare benefits.

Section 10 amends the rules relating to the means test for the carer's allowance scheme so as to exempt any foreign social security payments, up to the appropriate level of the Irish State contributory pension, that are paid to the carer or spouse of the carer. This section also clarifies that a general income disregard for the purposes of carer's allowance under Rule 1(5) for a single carer and Rule 4(3) for a couple will not apply to income from a social security payment, whether an Irish social welfare payment or a European Union or foreign social security payment.

Sections 11 to 19, inclusive, provide for the full transfer of the employment services and community services programmes of FÁS to the Minister for Social Protection and the integration of FÁS staffing, etc., into the Department of Social Protection and also provide for a consequential amendment to the Labour Services Act 1987.

I will table a number of amendments to the Bill on Committee Stage. I will introduce an amendment to provide for changes to social welfare legislation arising from the provisions of the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010. I also intend to introduce an amendment on Committee Stage which will provide for the introduction of a partial capacity scheme. The purpose of introducing a partial capacity scheme is to begin to address a critical limitation of the current social welfare code which categorises people with long-term illnesses or disabilities as either "fit for work" or "unfit for work". The focus within the welfare system on incapacity rather than capacity carries negative consequences for people with disabilities and their families who may be trapped in welfare dependency.

I will also introduce an amendment on Committee Stage to provide for the transfer to my Department of the community welfare service of the Health Service Executive, which currently administers the supplementary welfare allowance on my behalf. I will also bring forward consequential amendments to the Long Title, collective citation and commencement provisions.

Molaim an Bille don Teach and tá mé ag súil le bhur gcuid tuaraimí a chloisteáil maidir leis na míreanna atá ann sa dá lá seo atá romhainn. Go raibh míle maith agat a Cheann Chomhairle agus a Theachtaí.

I wish to share time with Deputy Timmins.

I welcome some aspects of the Bill and look forward to discussing certain other issues on Committee Stage. While I do not propose to oppose the legislation, I will oppose the proposal allow people to use mobile telephones to sign on for welfare payments. It would be a fraudster's paradise and I simply cannot support it, particularly given the existing levels of fraud. People are quite concerned and I have received an amazing number of letters this week from people nationwide who were surprised that such a proposal could be made at a time when savings of €460 million were made this year in respect of fraud. The Minister must convince me and other Members on Committee Stage that this can work and will not allow people to defraud the State any further.

I wish to make this point regarding the Bill first, because while Fine Gael supports many of the Bill's points, it will not support that proposal. I wish to make that clear from the outset.

As for the Minister's opening remarks on the amount of payments that have been paid to people in recent years, the Minister, Deputy Shortall and I, as well as everyone else in the House, have a job to do. The national four year plan will be announced today at 2 p.m. and all Members must ensure that those who are in need of social welfare payments will have such payments maintained to the best possible ability of the State. Many who are in need of social welfare payments are under severe pressure and are feeling the pain at present. In addition, if the Minister gets an opportunity at today's press conference, he and his colleagues should do two things. First, they might reassure people that the Government cares, because people are frightened. I have never encountered so many people in my clinic who have been upset because of such fear. Moreover, the media should note that elderly people in particular come to my clinic to ask whether their social welfare payments or pensions will be cut, whether they will be obliged to pay property tax or whether their savings will be safe. The second point I wish the Minister to put on the record today concerns the elderly people in particular who have contacted me in my office over the past 24 hours. Some people have some small savings in the post office and they seek reassurance from the Government that this money is safe because I have never received as many calls as I have within the past 24 hours. The Minister for Social Protection has an obligation to make a strong statement today to clarify this matter.

On the Bill itself, I will raise a few matters before finishing up on FÁS. First, I refer to the Minister's proposed change regarding illness benefit. In his response to the House, the Minister should state how many people will be affected and whether people will be at a loss or a gain. The Minister might confirm to the House what is the position in his response to this debate. In addition, I consider the proposal regarding rent supplement to be a good idea. Why should the taxpayer pay someone who does not pay tax? I acknowledge there will be cases whereby some people who live outside the State have property here but one must make provisions in this regard. I support fully the idea that people who draw down money from the State must have a tax clearance certificate.

However, I wish to sound a note of warning with regard to existing participants. While I acknowledge the Minister has stated that it will not apply to such people, if he continues with this measure in order that everyone must provide such a certificate, the tenant must be protected. In particular, the Department of Social Protection should take note that if renegotiations must take place, tenants should not be told that they will be obliged to leave their tenancy in cases where they are unable to get a tax clearance certificate from whoever is providing the rented accommodation. People must be given time, assistance and support. The Minister should send out a strong message to community welfare officers that the tenant is not the person who must provide a tax clearance certificate. It must be the person who owns the property. This measure is good, welcome and needed because the black economy is starting again. This must be corrected because that takes money from everyone's pocket. We must avoid the re-establishment of a black economy. While that already is taking place, it must be corrected immediately.

A point I intend to raise on Committee Stage concerns carers who come from foreign countries. What effect will the Minister's proposals have on such people? It has been the case that people who returned from America, England and other jurisdictions to look after their loved ones did not qualify for a carer's allowance because they could not produce evidence of their income. I hope the change in this regard will be positive because it is great to see family members returning from wherever to look after their loved ones. The Minister should be reasonable and decent about this because it is important.

I refer to the transfer of powers from FÁS to the Department of Social Protection. I welcome this and wish to put on the record of the Dáil that FÁS has been good, bad and indifferent. In its good parts, namely, at the bottom rung of the ladder, its staff did a good job in retraining people. They worked and helped and did not do too badly. Those in the middle ground, where decisions were not made by the management, did not do their job properly. However, the greatest scandal of all took place at the top rank of the agency. At a time when there was very little unemployment, the Government gave those people €1 billion in the budget of 2009. While everyone wondered why they needed this money everyone knows what they did with it when they went abroad on their holidays with their wives, families and everyone else. Although this inflicted further damage on both FÁS and Ireland, it should not detract from the overall purpose of FÁS or of retraining. While there are good people in FÁS, they are hurt. It is like politics in that there are both good and bad people in politics but one does not allow the bad to bring down the good and the same applies in respect of FÁS.

Ireland now faces an unemployment crisis and is in need of fresh thinking and new ideas but can FÁS deal with the crisis? The day has gone when someone who is unemployed is only brought in for an interview once every two years. Such people should be brought in on a regular basis every two to three weeks. Such people must be retrained, re-skilled and re-educated and work placements must be found for them. However, this is not what was happening. Instead, they were being brought in for interview. What really is needed is a one-stop shop, whereby an unemployed person can come into a social welfare office staffed by community welfare officers and FÁS staff who will train them and try to get them back into the workplace again. It is very important to do this and that as many people as possible are returned to the workplace.

At present, the drain game is on again. We are losing a generation of young people, which will have a negative effect on the economy over the next 20 years because those people will be gone. They will leave the country for America, Canada, Australia and all over the world and we will lose them. When, please God, Ireland returns to full employment and people are needed to fill vacancies, these people will have gone abroad. This brain drain must stop and we must try to create employment for them now, even in bad times. During previous bad times, new ideas and fresh thinking were developed and we need ways to try to retain, educate and procure work for people because unless that generation remains, who will look after the generation ahead of them? One must never forget this.

As for FÁS itself, new thinking and ideas are needed. New ways to do things are required but this has not happened over the past ten years. FÁS is coming under the aegis of the Department of Social Protection and the Minister now has a duty and an obligation to make sure that what happened over the past ten years will never happen again. He must ensure that every penny of taxpayers' money is spent wisely and that it is spent in an attempt to educate those who need to enter the workplace.

I refer to the staff who are being moved over to the Department. How many staff are coming from FÁS to the Department of Social Protection? Will their employment rights be protected in this regard? I note the Minister stated in his contribution that the buildings also would be transferred. In his response over the next 24 hours, the Minister might indicate to Members what is the value of the aforementioned property. I acknowledge it all is State property that will remain in the hands of the State but that will be transferred to the Department of Social Protection.

When young people have been trained, there must be a follow-on. There must be the capacity to monitor people who were registered as being unemployed and who went to the community welfare office and were trained by FÁS. Some placement work should be secured for such people as we must be job active. There are many good ideas in circulation and many people wish to employ people. However, over the past 13 years, two things have happened. Even though the Government forgot about the small employer, that is, the person who employed one, two or three people, we must return to them.

We will never again see multinational companies coming into the country and employing 2,000 or 3,000 people. Those days are over. We must start thinking small and then work to get bigger. We need to train people. People with good ideas come to see me every day and write to the Minister and to the Government. What we need now is a stimulus package to help these young people. The banks are not supporting them and neither is the Government or the IDA. They are simply concerned with getting investment from Australia and America because they think our own cannot do it. Our own can do it, if they get some backup, support and training.

FÁS needs new ideas, new thinking and new training. We need to deal with the problems we have today. Change may be required. We do not want people in the FÁS office or a community welfare officer saying, "This is not in the legislation". If it is not in the legislation and it is right, we should do it anyway. We should come back to the House and change the legislation on any occasion that is needed. We need new ideas, new thinking and a new way of doing things.

What has happened in the last number of years cannot go on. FÁS did a good job training people. There were occasions when certification was not properly done and that must be dealt with in the courts. If people were being paid and were falsifying any kind of qualification they should be dealt with. The same is true of the banks. People are angry because they feel no one has paid for this situation. No one has borne the brunt of responsibility for it. The people who will bear the brunt in the budget are the people on low incomes and on social welfare. These people did not cause the problem but they are the ones who will have to correct it and pay for it. We want action taken against the people who did cause it.

FÁS schemes, such as the rural social scheme, worked very well for long-term unemployed people. We should look at ways to get more people trained and working to provide for the State. I hope that will happen. I hope the Minister will bring new ideas to the House to get people trained and working. The Minister referred to the workplace programme. He talked about it but we want action on it. We have had enough talk and media spin. What we want is action and to get people trained and into the workplace doing valuable work for the community. There are people who want to do that. We do not want people to be degraded. We do not want to use our present difficulties as an excuse to take people off the social welfare system. We want people to be retrained and actively looking for work and the State helping them to get that work. People must be trained and ready to take up work when it becomes available. We need to do that quickly.

I welcome some aspects of the Bill. I know the Minister will introduce amendments on Committee Stage regarding same sex couples. Legislation in that regard will be introduced on 1 January and Fine Gael will play our part in getting that legislation over the bar before the election. We are anxious to have the election and to get into government, protect the people who need protection and get new ideas and thinking for the country. That is what is wanted.

On Committee Stage, we will go through many aspects of the Bill, particularly those relating to FÁS. There is concern about FÁS and the way it has been run for the last number of years. I hope the Minister has this issue in his grasp and that what went on for the last ten years will never happen again. It was a national scandal and it must be dealt with. People used money intended for the unemployed and for people who needed to be retrained and re-educated. People blew that money abroad and blew FÁS. I hope the Minister will put his mark on the retraining brief. It is now more important than at any time since the foundation of the State. We will go through the Bill and examine amendments on Committee Stage.

We need every protection possible against the people who are defrauding the State and taking badly needed money out of our pockets. We must encourage and help people. Yesterday, during Question Time, we talked about rent allowance. We should not discourage people in the social welfare system from going to work. They should be encouraged to seek work.

I believe the Minister has reassured people on community employment schemes that they will not suffer cutbacks in terms of double payments. I welcome that. FÁS schemes and CE schemes have done great good for communities when the HSE, the education system or local authorities were not able to provide badly needed services. People on CE schemes have visited people in their homes and organised meals-on-wheels. Many voluntary groups, particularly in rural and isolated areas, need FÁS schemes. These schemes should be retained and maintained.

We want to get people back into full employment. That is the most important aspect of the Bill. The more people are employed the more taxation will be collected and the fewer people will be drawing off State welfare. To protect the welfare state we need more people working.

We must have a one-stop shop for unemployed people. We must not have seven or eight different groups dealing with the unemployed. They must be dealt with in one building rather than going from Jack to Joe and from Mary to Kate. That is frustrating. The necessary management and team must be available in a single building.

Change for the better is what we want. We need positive change to help people in their hour of need. Many people who have worked all their lives have lost their jobs and want to work. We must stop the emigration drain. If we do not do that we will have made the biggest single mistake ever.

I agree with my colleague, Deputy Ring, about the importance of looking after the most vulnerable in our society. We talk about the elderly, the sick and many who will never be able to work again. It is also important to acknowledge that many people who receive payments from the €20.9 billion welfare budget are not vulnerable. It is important to realise that. I would like to see the Minister split the welfare budget between those who are vulnerable and those who are not in difficulty. That would be important from a political point of view. When one talks about cutbacks in the welfare budget one immediately thinks of carers and the elderly. There is a cohort of people who are not vulnerable.

I am also concerned about the amount of social welfare fraud. If we tackle this issue properly we could save several billion euro.

I want to deal with the issue of the high State dependency rate. In February 2001 at a time of virtually full employment there were still 137,400 people on the live register claiming State assistance. An analysis done by the OECD on the Irish labour force in 2009 concluded that Ireland had a disproportionate number of people claiming incapacity, unemployment, lone parent and safety net benefits, when compared to countries of similar labour markets and historical roots such as Australia, New Zealand and Britain. These countries made a determined effort to introduce new progressive employment and training policies to encourage benefit recipients into working during the years of high demand for employment. Ireland did nothing, and in 2007 still had 15.6% of the working age population claiming incapacity, unemployment, lone parent and safety-net benefits, up marginally from 15.2% in 2001. Considering our younger population, Ireland's rate of incapacity benefit should be lower than the other surveyed countries instead of higher.

The meaning of all this is that our high State dependency rate is making the current unemployment crisis worse and fostering a vicious circle of long-term unemployment as long-term benefit recipients lose touch with the labour market and become demoralised.

How Ireland responds to the current unemployment crisis will have a big impact on how long the crisis will last. Simply put, if the Government continues with its current policies and structures, we will face a prolonged period of high unemployment and all the social ills that it brings. The longer this spell of high unemployment lasts, the harder it will be to break out of it.

The OECD, when assessing the Irish labour market, claims it is not just a simple matter of lowering social welfare rates to encourage employment but actually about having proper activation measures or strategies to return people to work. This means having a hands-on approach with the unemployed involving constant attention and compulsory consultation from State employment bodies to move people back into the workplace. The OECD cites international experience of countries without such measures enduring many years of high unemployment rates following an employment shock. Ireland does not have such measures, which results in a hands-off approach to the unemployed.

The OECD describes what this will mean for Ireland:

Together with weaknesses in activation programmes for people out of work, there is a real risk that unemployment could indeed become permanently high unless policies adjust to provide stronger encouragement to return to work as the economy recovers.

Deputy Ring dealt very eloquently with the concept of the one-stop shop for getting people back to work. Fine Gael's policy document "Reinventing Government" sets out our vision for helping people back to work through the provision of a one-stop shop called the payments and entitlements service, PES. The service will become a one-stop-shop for getting the unemployed back to work. FÁS will be dismantled and the PES will become the unemployed person's pathway for re-entering the workforce. The PES will deal with the individual from start to finish, combining functions currently split between the Department of Social Protection and FÁS. When a person becomes unemployed, he will go to the PES one-stop shop to register and undergo assessment for his social welfare entitlements. He will then undergo a thorough skills assessment and will be given the opportunity to avail of recommended training in accredited training providers, paid for by the PES. The PES will provide a range of employment services, carrying out regular face-to-face interviews with the unemployed.

Some services historically provided by FÁS will be devolved to other areas and some will be wound down. Community employment schemes will be devolved to local government, services to business and recruitment services will become the remit of Skillnets and the private sector and the State will represent a trainer as a last resort. The FÁS training model will be replaced with a voucher system for training.

The one-stop-shop model will transform the approach to dealing with the spiralling unemployment problem. This is needed as there are too many agencies and bodies. People are confused and do not know where to go or what to do. Our proposal is about matching skills with needs in the labour market. One can only do this by establishing the skills people have in the first instance.

The main provision of this Bill involves the breaking up of FÁS. Deputy Ring dealt with some measures, including section 4, which pertains to electronic means of clocking in. I do not know how it will work. It seems very dubious.

Section 5 deals with the landlord tax reference number. During Question Time yesterday, Deputy Ring alluded to the question of rent supplement. Housing should be provided by the local authority, not the HSE or Department of Social Protection. There are many empty houses in the housing stock of local authorities. When local authorities assess people for housing needs, they tick off everybody and give them all rent supplement. There are many vulnerable people who need rent supplement and assistance but there are many who get it who do not necessarily need it. On our housing list, we must differentiate between housing need and housing desire. This has not been achieved. Only those with a housing need should receive a rent supplement.

With regard to my next point, Deputy Ring and I have some private debates. The vulnerable should be looked after but any euro spent, because of fraud, on those who are not vulnerable means the vulnerable lose out. The same applies in education. Free education does not mean free education for everybody. It means a certain proportion of people cannot get educated because, while they may have no fees to pay, they cannot get the grant they may need because there is only a limited amount of funding in the budget.

I do not support the concept of universality. It does not deal with the quality. It purports to have everybody equal but does not achieve this. The same applies in respect of rent supplement. Many lose out because money is being spent on accommodation for those who do not need it. Consequently, there are many people on local authority housing lists who cannot obtain accommodation of good quality.

Many people are living in very substandard accommodation, be it in the private rental sector or the social housing sector. We need to consider this. There are only two ways to address inequality. One can never fully achieve equality but one can seek to address the problem through education and housing. The housing scheme should be such that everybody should be encouraged towards home ownership. Where there is home ownership in local authority estates as opposed to circumstances in which every home is rented, the standard of living and quality are higher. One sees this in certain local authority estates. We should aspire to this. It is the only way in which we can get people to break out of their poverty trap. The same applies to education. Early intervention and access to education are more desirable than free fees for everybody. Fine Gael has a very progressive graduate tax or PRSI proposal that I hope will be implemented in the months ahead.

Deputy Ring dealt with FÁS. It is a terrible tragedy that FÁS represents a debased currency. Much good work is done on the ground, yet the failure of Ministers to address the shortcomings of management brought the whole organisation into disrepute. There are many fine examples of the excellent work that FÁS carried out.

The most startling point I heard in the Minister's speech reflects the difficulty the Government was in. I do not know whether the Minister prepared his own script or whether the Civil Service did so. I want to bury this item because it is reflective of why we are in the difficulty we are in. There is a reference to social welfare, which may not be the greatest example for an Opposition Member to pick, but it is reflective of the difficulties we are in. Let me quote the Minister:

The Government is proud of its unrivalled record in increasing social welfare payments. In the past 12 years, we have increased pension rates by about 120%, unemployment benefits by almost 130% and child benefits by 330%. The cost of living has increased by about 40% over the same period.

Over the period in question, the budget increased from €6.7 billion to €20.9 billion. In the 80 years since the foundation of the State, from 1918, 1921 or 1922 — I get confused——

I thank the Minister.

In the 80 years up to the turn-of-the-century, there were 16 or 17 Governments. The Minister's grandfather was the head of many of them. The Minister's party was in Government for almost all the period in question. Did those Governments fail the people in that they did not give adequate resources to the people who were vulnerable, including pensioners, the unemployed and those requiring child benefit, such that dramatic increases were required between 2000 and 2010? Alternatively, was it the case that the Government bought the people with their own money and now must repay it in multiples? I believe the latter. This is a damning indictment of the policy of the Government. I can still hear the clapping ringing in my ears after the budget in which every benefit was increased. Money was spent as if by drunken sailors and as if there were no tomorrow. Unfortunately, tomorrow is here today and we are suffering because of this policy.

The phenomenon to which I refer is indicated by way of the stark welfare figures but probably more so by the startling figures right across the board. There was a 40% increase in the cost of living and there were increases in welfare. One should not tell me that the Governments in power since the foundation of the State, 12 or 13 of which were Fianna Fáil led, left the people in poverty for 80 years because I do not believe that. What actually happened was that the last few Governments sold the country down the Suwannee with its policies.

I am glad to have the opportunity to speak on this Bill, although we were given very short notice. The Bill could be described as a mixed bag. Overall, the Labour Party supports and welcomes it. However, we have reservations regarding certain aspects of the Bill and we will deal with these by way of the introduction of amendments.

The Minister referred to the level to which the cost of social welfare has increased in recent years. There is no doubt the current bill of €24 billion is massive. However, it is important to clearly outline why that amount is so high. The cost of social welfare is as it stands at present because the rate of unemployment has increased substantially. Every person who loses his or her job costs the State in the region of €21,000 per year. That is the real shame and indictment of the Government, which in recent years completely ignored the importance of protecting existing employment and creating new jobs.

Most Cabinet Ministers have become fixated on tackling the huge issue relating to the banks. However, the Government took its eye off the ball in the context of ensuring that employment would be placed centre stage. No work has been done in this area and there was no consideration of the kind of supports to be put in place or of the work that needed to be done to protect the maximum number of existing jobs and to encourage the creation of new ones. That has been a huge failing of the Government in recent years and it is the reason the bill for social welfare is so high.

The Deputy should check the facts. She is wrong.

It is because we have such a problem with unemployment that the cost of social welfare is so high. The massive numbers of people who have lost their jobs since this Government took office, the cost of retaining people on social welfare payments and the loss of tax revenue to which the increase in unemployment has given rise account for the huge gap of €6 billion in the public finances. The figures support my argument and the Minister cannot deny that. The Government's greatest shortcoming has been its failure to protect employment or to take action in respect of the loss of jobs.

No, it does not account for the increase in social welfare.

The Minister should desist. He will have the opportunity to reply to the debate.

Perhaps the Minister will allow me to continue. I did not interrupt him.

In the case of the promises that were made in the programme for Government to take action on the jobs front, the approach taken in respect of the relevant initiatives has been lacklustre. There has been no enthusiasm or energy regarding the initiatives to which I refer. For example, in the context of the Minister's area of responsibility, the PRSI incentive scheme was announced with great fanfare in last year's budget as an initiative that would encourage employers to take on new staff. The budget to which I refer was announced last December but the Minister sat on the scheme and took no action in respect of it until the middle of this year. It was only when he came under pressure in June that the Minister finally announced the scheme. As a result, there is no prospect of the targets that were set being met.

Funding was provided in the last budget in respect of this scheme to enable the Minister to provide support for a large number of jobs. However, he allowed time to slip by and waited until the middle of this year before taking concrete action. Even now, there is no enthusiasm in respect of promoting this scheme. As a result, by the end of the year we will fall far short of the targets for this scheme. Again, that is an indication of the lack of interest, enthusiasm and energy that is being displayed in respect of job creation.

We must also consider the huge damage that has been done to the SME sector, which is the backbone of job creation in this country. When the blanket guarantee for the banks was put in place, we were informed that the main justification for such a guarantee was to get credit flowing. That was the mantra every Minister uttered at the time. Two years have passed, however, and credit is still not flowing. The SME sector is being squeezed just as much now as was the case prior to September 2008. Again, consideration was not given to what this sector required to retain existing jobs and, ideally, to create new ones. The SME sector has been abandoned by the Government and the level of unemployment has soared as a result.

When the four year plan is announced today, people will be waiting to see whether the Minister, in the context of his area of responsibility, will protect the most vulnerable. Prior to the previous two budgets, members of the Government repeated another mantra in respect of this matter. However, that was a case of their saying one thing and doing another. Ministers and backbenchers were trotted out to say the Government's priority was to protect the weakest. They continued to state this but when it came to the budgets to which I refer, the Government took decisions which penalised the weakest and left great swathes of those who are either very or exceedingly wealthy untouched. How can anyone place any store in the undertakings the Minister is giving to protect the weakest when the Government's track record shows that while it says it will do this, it does the opposite.

Not only does the Minister have responsibility for the welfare system, he is also responsible for pension policy. We have discussed this matter on previous occasions but I am again obliged to state that the spotlight must be shone on what he has done in this area. When the four year plan is announced, I will examine it to see if any attempt will be made to rejig our tax and welfare systems in order to support and protect the weakest. The only way to do this is by ensuring those at the top end pay their share of tax.

Under the Minister's current policy, some €3 billion is being given to people by way of tax reliefs on pension contributions. We are aware that the bulk of this money goes to the top 20% of earners. If the Minister is serious about ensuring the system is fair and about protecting the weakest, I expect he will announce radical proposals to reform the pension tax relief system. He has an obligation — in the context of fairness and justice — to those who depend on him for protection to introduce the reforms to which I refer, to slash pension tax reliefs for the high rollers in this country and to take serious steps to introduce a measure of fairness into the policy areas for which he retains responsibility.

I will monitor the plan to identify the changes the Minister will make to the pension tax relief system to ensure fairness. We do not want the usual targets to be hit yet again. Neither do we want people who are struggling to survive on welfare payments to take the brunt of the cuts which the State must endure as a result of Fianna Fáil's mismanagement of the economy in recent years. There is an onus on the Minister to take a fair approach in respect of this matter and to defend those people who, in many ways, do not have a voice and who depend on him to protect them.

There is enough evidence available which shows that large numbers of people dependent on welfare payments are struggling to keep their heads above water. The most recent research carried out by the Vincentian Partnership in respect of minimum essential budgets refers to the difficulties for different categories of welfare recipients, particularly those who live in rural areas. The research to which I refer also shows that when one does the sums, it is evident that welfare payments are not sufficient to allow people to live with any kind of basic dignity. The case has been well made — particularly in the context of the Vincentian Partnership's research — that people who are dependent on welfare payments simply cannot afford to shoulder any more of a burden than that which the Government has already placed on their shoulders.

I hope the Minister will not support any further cuts in welfare payments for those who are on the lowest levels of income and who are dependent on him for their very survival. He has a number of options available to him in the context of making savings. There are opportunities to make savings in areas where persons are hoarding large amounts of non-productive capital. There are persons with multi-million euro pension pots that the Government has allowed to accumulate and I hope the Minister will dip into those pension pots. I hope the Government will slash the amount of tax relief millionaires are currently entitled to claim. If there is any fairness, if there is any justice in the approach to the current problems in this country, the Minister has no choice but to tackle those areas before he contemplates further cuts to welfare payments. We will watch closely and unless the Minister does that, he will have no credibility as Minister for Social Protection.

The principal purpose of this Bill is to transfer some functions of FÁS in the employment services area to the Department of Social Protection, and I welcome that decision. There have been serious problems with FÁS in recent years. As an organisation, by and large it has not been doing the kind of work it should have been doing. It has not, by any means, used the funding available to it to best effect and the focus of that organisation has not been always on the client, the unemployed person.

We saw how those at the top of the organisation — Mr. Rody Molloy, but many others, some of whom are retired and some of whom remain——-

To clarify the time, we will continue until Deputy Shortall has concluded her speech.

How long more have I?

Deputy Shortall has another 17 minutes.

I thank the Leas-Cheann Comhairle.

FÁS, as an organisation, was let down by senior staff, such as Mr. Rody Molloy and others, some of whom have left and some of whom remain in senior management positions. They discredited the organisation and were more interested in feathering their own nests, living a high lifestyle at the expense not only of the taxpayer but of unemployed persons who were looking to FÁS to help them access training and employment. That was the real mistake of those staff. Not only did they waste public money, but they did not serve their clients. For that reason, I welcome the proposal to split FÁS. There is much good work being done at local level by area managers with employment services and training services, but as a brand, FÁS has been tarnished and because of the discredited senior management in the organisation, FÁS needs a clear new focus. I welcome the fact that the functions are to be split between the Departments of Education and Skills, and Social Protection.

Not only is responsibility for the organisation changing to another Department, but the employment services are being incorporated into the Department of Social Protection. That is a good move which I support, but I hope it will not be merely a matter of changing the name or status of those who work in FÁS. The Minister must avail of this opportunity to radically reform, modernise and streamline the employment services so they are fit for purpose and respond to the needs of the unemployed, in terms of identifying gaps in their skill levels, the kind of training they require, where that training is available and the work opportunities available to them. They must ensure the unemployed are best placed and best qualified to apply for employment opportunities that arise.

At present, the organisation is a mess. When people lose their jobs, they go to the social welfare office to get their payment which is their immediate concern, but that should be only one aspect of the welfare system. Welfare payments help people survive financially, but the other side of the coin must be to ensure people remain dependent on the dole for the shortest possible period and that they are aware of all of the available training, education and employment opportunities. That must be the responsibility of the Department of Social Protection. In the past, there has been tokenism in this area in terms of jobs facilitators — only 67 of them to deal with the considerable numbers of those unemployed — and what the Department of Social Protection was doing was completely disjointed from that which other agencies were doing. I welcome the fact that the employment services are coming under the Department of Social Protection but it must result in added value for everybody involved. This opportunity must be used by the Minister to transform the way the system operates.

On a regular basis persons who make contact with my office ask how they would be affected financially if they went on a training course, if they were to take up part-time work, temporary work or casual work, or if they were to go into work full time. They want to know how that would affect their take-home pay. I do not know if there is anybody within the Department who is qualified to do that kind of assessment or analysis for a person. That is what people want to know. There does not seem to be anybody in the Department who can do the sums, who knows fully how the tax system or the welfare system works. When I say "fully", I mean it is not merely about getting the payments, but also about the secondary and in-work benefits. What we need are qualified staff who understand the welfare and tax systems and who can give that basic information to people.

We also need staff in the Department, whether they come from FÁS or are originally staff from the Department, who will meet on a regular basis persons who are unemployed to ask them about their needs and to ensure we have a good profile of all of the unemployed in terms of their skills level and gaps in training. We can then match those gaps with the courses being provided. That might sound like basic common sense, but that is not happening in many areas. FÁS sometimes provides certain courses for which there is no demand. Equally, there is a kind of overlap, and sometimes gaps, in services where FÁS might be doing one thing but the VEC is doing something else, or the local secondary school, the local partnership or the LES are providing other courses. The Minister needs to bring coherence to all of those services and agencies. There must be a one-stop-shop approach. That means that when a person signs on, he or she will be interviewed and provided with the basic information, advice, support and encouragement to get off jobseeker's payment as soon as possible. I hope the Minister will use the opportunity to do that.

I also hope when the Department takes over the employment section of FÁS that we will have sound data on what is happening. This morning, at the Joint Committee on Social Protection, we were talking to SIPTU and OPEN about the question of progression from CE and there were no data available on the length of time persons remain on CE. There is much confusion about how long one is allowed to remain on CE, but there is no information available on the level of training of CE participants, for example, how many CE participants would have a FETAC level 5 award by the end of their CE training. We need this basic information because the focus of CE — I accept many of the services provided are worthwhile — must be on progression from the point of view of the unemployed. They must enhance their skills so they can move out into the open labour market and get work. We have no data on this and I hope that under the new arrangements we will have up-to-date data on what is happening here.

The other major area is with regard to rent supplement. I am quite disappointed with the Minister's proposals on this. They do not go anywhere near far enough in terms of what is required. In September 2008, the Committee of Public Accounts, having examined the entire area of taxation of rental income receipts, published a report. It found a hopelessly poor rate of matching PPS numbers. While the Department of Social and Family Affairs, as it was at the time, asked for PPS numbers it matched less than half of them. Most of them were untraceable or bogus, which was incredible. The Committee of Public Accounts returned to the issue earlier this year when the Department came before the committee. We asked what was happening with regard to tax compliance of landlords in receipt of rent supplement given all the attention that was focused on it. We were told that PPS numbers could be traced for only 31,000 of the 96,000 tenancies.

I welcome the fact that the Minister is taking some steps but he is not going anywhere near far enough. His two predecessors used to state this had nothing to do with them as it had to do with the tax office. This approach is no longer acceptable. If €520 million of taxpayers' money is going to pay private landlords, the least we can expect is that the Department of Social Protection will play an active role in ensuring full tax compliance in the payment of this vast amount of public money. To date, the Department has been extremely lax in this area.

What the Minister proposes today is not enough. He has stated that the PPS number will be requested. Many landlords cannot be traced; nobody ever sees them or hears their names or addresses as agents are used. How will the Minister deal with the PPS number in such situations? A significant and growing number of landlords receiving rent supplement are non-resident. The minimum the Minister should do with regard to non-resident landlords is to introduce a withholding tax of 20%. There is no way this money should be paid without the State getting some tax clawback.

Overall, with regard to resident landlords, what the Minister needs to do is to ensure full tax compliance. A tax clearance certificate should be obtained before the State pays rent supplement. This happens in many other areas where grants are paid, for example grants to builders for bathroom conversions. A grant will not be paid unless a tax clearance certificate is produced, and the exact same should happen with regard to rent supplement. It is not enough even to do this. The area of rent supplement is crying out for major reform. In his speech, the Minister spoke about wanting to be a reforming Minister. This is probably the area in greatest need of reform.

Yesterday, we spoke about the perception that many people on welfare are better off staying on welfare rather than taking a job. This is not true; the vast majority of welfare recipients would be better off, and significantly better off, in employment. However, there is one category of welfare recipients for whom there is little or no incentive to go to work and this is people in receipt of rent supplement because of the way with the rent supplement system operates at present. The Labour Party proposes a number of reforms in this area. The ban on people working full-time receiving rent supplement must be removed. The withdrawal rate is far too drastic and this is the difficulty.

Yesterday, I gave the Minister the example of a married man with two children. If he moves from being on the dole to taking up a job he stands to lose €60 a week, not because welfare payments are too high or because the dole is too high but because of the way in which rent supplement operates. If there was a graduated withdrawal of rent supplement and if the automatic ban on receipt for anybody working 30 hours or more a week was removed a huge incentive would be provided for people to take up employment. This is the problem at present. Not only would this encourage people to take up rent supplement, it would result in significant savings for the State. A total of €19,000 or €20,000 a year would be saved if a member of a couple went back to work. It makes absolute sense to reform rent supplement and tackle it.

With regard to tax compliance, what the Minister should do is what several agencies have been imploring him to do for some time, which is to make local authorities responsible for rental support and pay rent supplements directly to the landlord. This is how abuse, tax evasion and social welfare fraud would be cut out. Significant issues are raised, such as some tenants not passing on the full rent supplement and landlords demanding top-up payments. There is much abuse in this area as the Minister well knows and the way to tackle it is to make the payments directly to landlords and not to catch the tenants in the middle. Every year, we lose millions of euro through deposits going astray because they are not given back by the landlord or because the tenant does not return them.

The Labour Party has calculated that if these reforms are introduced along with reform of the deposit system there is potential to save at least €100 million a year. If the Minister wants to make savings in welfare there are ways to do so that do not hit the most vulnerable. We are stating that €100 million could be saved in rent supplement in the coming year and €400 million could be saved over the next five years if the Minister were to introduce the reforms suggested by the Labour Party. Not only would this be a saving to the State, it would mean there would be incentives for people on welfare to go out and work. It would be worthwhile to do so, which it is not at present for many of them.

With regard to fraud, I want to express serious scepticism about the Minister's proposals for electronic certification, which are contained in the Bill. The system needs to be modernised in many ways, but what the Minister proposes with regard to people signing on by way of mobile phone concerns me. Given the level of fraud that already exists in the Department, I urge the Minister to tread very carefully in this area. He should start with a very small pilot scheme and rigorously analyse its findings. I am concerned it would open up the potential for further fraud. I am disappointed at the conservative targets for tackling fraud which the Minister is setting in the Department. It has been some time since the Minister has come anywhere close to meeting those targets.

I hope the public services card is available and is used widely in the coming months. I am disappointed there has been slow progress on it. I certainly hope the public services card will provide for biometric information. People who defraud the social welfare system are the enemies of those who genuinely depend on it. The Minister has a serious responsibility to ensure that he deals with budgetary pressures by eliminating fraud. This can be done on several fronts and we have given him ideas on it.

I look forward to a more detailed briefing on the amendments signalled by the Minister today. I hope we have it prior to Committee Stage.

Debate adjourned.
Sitting suspended at 1.50 p.m. and resumed at 2.30 p.m.