Deputy Ó Snodaigh is in possession and 26 minutes remain in this slot.
Social Welfare and Pensions Bill 2014: Second Stage (Resumed)
Question again proposed: "That the Bill be now read a Second Time."
Yesterday, I made the point that, in the main, this is an innocuous Bill. That said, in some ways it is not because this is a rushed item of legislation. It deals with approximately 14 different aspects of the social welfare and pension codes and, consequently, each change can have a profound effect on one or several individuals or, in some cases, thousands of people. As a result, while it is an important Bill in itself, many other issues could have been but have not been dealt with in this Bill. Many reversals of the Minister's cuts over the past three and a half years should have been contained in this Bill, given the current position in respect of social welfare expenditure and given how the public has suffered continuous cuts since this Government and Minister have been in charge.
Another point on which I was concluding last night related to my concerns on section 3 of the Bill in respect of An Post. My concern is that, to date, An Post has been mentioned in legislation and, as such, has been the preferred bidder in every opportunity.
Open competition.
There is no competition. Well, open competition but-----
Sorry, under European law, there is open competition.
At present, it is mentioned in law as An Post. My concern is this measure is opening it up and the Minister is admitting this is opening it up to competition.
Because of European Union law.
I do not necessarily blame the Minister-----
I thank the Deputy.
-----but not everything the European Union demands of us must be implemented in the way it often is implemented by the Government. There are concerns about society, changes therein and the need to protect institutions that serve society best.
I am aware there has been an ongoing exchange in the EU about postal workers. This is more a concern for the Minister for Communications, Energy and Natural Resources. The postal workers' unions across Europe have lobbied for protection of the services. In this instance it is not the personnel who deliver the post, the postman or post woman whose jobs are at risk, but rather the institution of the post office is at risk. There is a danger to the institution if the postal service is opened to competition and if the privileged position of An Post as stated in legislation is removed. This Bill proposes to remove the statutory protection of An Post which means the service will be open to competition. I will not go over all the arguments but in my view - which I have argued with this Minister and the previous Minister - the post office has a specific role in the distribution of social welfare payments and in implementing anti-fraud measures. The post office offers a personal service which should not be ignored in this era of open competition.
It could result that a bank or other financial institution with no loyalty to Ireland or to anyone bar the money it earns would be contracted to supply these services and there could be a danger that society would not benefit. If the contract for delivery of social welfare payments is moved away from An Post to a bank, I am very concerned about the effects in many small towns and villages and some urban areas across the country. I have concerns about the move to pay social welfare payments directly to bank accounts which has been encouraged by the Department of Social Protection because the more people move away from the personal interaction in post offices, the greater the danger of fraud. It also poses a danger for society because the majority of people who depend on social welfare payments use the post office every week. If all social welfare payments, such as dole payments, child benefit and old age pensions, are to be paid electronically, many people will become more isolated from society as they will do all their business online and they may not have any reason to come out their front door. Everything can be ordered on the Internet and people need to be aware of the dangers as well as the benefits when making these decisions.
I expect to return to this issue at a later date given that the changes in legislation are designed to facilitate a move away from An Post. If such a move is made, I presume tenders for the contract would be required and it would, hopefully, be discussed in this House in advance of any change. We will need to discuss the change and also the parameters for the contract other than the provision of commercial financial transactions. The social aspect of that contract will need to be borne in mind.
I wish to address the legislation which deals with aspects of a 2010 EU directive which I believe need to be passed before the summer recess although I may be mistaken. There does not seem to be any urgency in passing this legislation or indeed the majority of it.
Which legislation?
This Bill. There is no urgency yet it was published-----
I anticipate-----
Deputy Ó Snodaigh has the floor.
It was published on Friday and we are discussing it today. It is not the way to do business and there should be more time between publication and discussion.
The Minister may remember one of the first Bills she brought to the House in July 2011 was to legislate for the minimum wage rate. We welcomed that Bill at the time but I argued that the Bill removed the need for all legislation to be translated into Irish. My argument has been that along with every other Deputy, I am hampered in my ability to address legislation through the medium of Irish because there is no provision for an explanatory memorandum as Gaeilge. This is not a criticism of the Minister because not one Minister has produced an explanatory memorandum as Gaeilge which would help to increase the use and level of Irish in debates on important issues such as this. It is not fair on me nor is it fair on the Minister if I attempt to engage with the Minister while we are both wearing headphones. I know this is the practice in the European Parliament and it succeeds very well but it is easier if at least the vocabulary used in the Bill is available to me and to the Minister and to the translators. We all have a level of Irish but we might not be able to follow the conversation without the services of a translator. I ask the Minister to raise this matter at Cabinet.
Since the Minister took office there have been a series of cuts although she has made great play about avoiding cuts to core rates of social welfare. I have argued previously that she has in fact done so in many cases although some payments such as disability allowance and the old-age pension have been spared. Other core social welfare payment rates have been cut, including the jobseeker's allowance. The jobseeker's benefit by virtue of the reduction in months has also been cut substantially. Given the day that is in it, I remind the Minister that today is the day for payment of the respite care grant to thousands of carers all over the country. This year they will be short €325 which the Minister cut from that core rate in budget 2013.
They cut a lot more.
I agree there has been a range of cuts. However, given the day that is in it, it is worth reminding people that the Minister could reverse the cut to the respite care grant which was estimated at the time as €26 million or €27 million. Everyone on all sides of this House would urge the Minister to consider reversing the cut. It could have been contained in this Bill. She could have looked again at the cut in the fuel allowance which, at a cost to those families who were dependent on it, amounts to €24 million.
I will deal with some of the range of other issues. We are half way through 2014 and already the PRSI yield is €100 million greater than the anticipated €138 million.
This is a substantial and welcome boost to the coffers of the Department, which flags that the Minister has scope to reduce the effect of the cuts she has implemented in the past three years. Rather than passing on these savings to another Department or the Exchequer, it should be used to alleviate the hardship facing those who depend on social welfare payments. One of the key aspects of any stimulus package is that every cent in social welfare is spent, usually in the local economy. The Minister should consider the boost a reversal of cuts would give social welfare recipients and local economies.
Having campaigned in Dublin and elsewhere during the recent elections, she will be aware of the many towns and villages which have become wastelands because shops and services have closed. If nothing else, she should consider reversing some of the cuts she implemented in recent years, including the changes to illness benefit, treatment benefit, the diet supplement scheme, the fuel allowance, the household benefits package and the telephone allowance, all of which have had a detrimental impact. The Minister also diminished entitlement to the State old age pension by hiking up the pension age and cut the bereavement grant, rent and mortgage interest supplement and the back to school clothing and footwear allowance.
The Labour Party promised during the general election campaign that, if elected, it would not interfere with child benefit rates. Child benefit payments for a family with four children have been reduced by €58 per month since the Minister came to power. In addition, the core rate of jobseeker's allowance for many young people has been cut by €44 per week, while the eligibility period for jobseeker's benefit has been cut by three months. I still cannot get to grips with the logic of cutting maternity benefit. Changes to the invalidity pension will result in a cut of €1,914 per annum for many people aged 65 years. I have set a number of areas that should have been addressed in the Bill. If the Minister had taken action on these issues, she would have reinforced the message she appears to be sending outside the Chamber in the leadership contest for the Labour Party. Members of her party are being offered a Hobson's choice of either the Minister for social welfare cuts or the Minister of State for medical card cuts.
I welcome the Minister's conversion to the view that austerity does not work, which has been Sinn Féin's position for a number of years. She stated recently:
Ireland has to move away from the current economic narrative of pain and penitence; we need to become a society again, not an economy... But this cannot be done under the austerity model.
We have been shouting this message from the rooftops for years and the Labour Party has not listened. If the Minister's views become the new model for her party in government, my party and the electorate will measure it by its actions. I regret, however, that this Bill does not suggest it has adopted a new model.
Most of the changes in the Bill are welcome, if not urgent. I referred to the change regarding An Post. Most of the other measures are minor changes aimed at tidying up various matters. Sinn Féin has some minor concerns about some technical aspects of the Bill. We will deal with these in greater detail on Committee Stage as we require additional information from the Department. At a minimum, the scope of the legislation should be widened.
As well as the change regarding An Post, the Bill introduces changes to PRSI and share based remuneration. Sinn Féin welcomes the proposed change regarding the recovery of PRSI from employers in respect of refunds. I tabled amendments previously to address an anomaly that arises when deductions are made to payments made to former employees in unfair dismissal cases. None of these deductions, which are made in lieu of social welfare payments, is transferred to the Department of Social Protection. Addressing this matter would require a minor change in the legislation in line with the tidying up being done elsewhere in the Bill. Under the current system, where €5,000 is deducted from an award of €10,000 for social welfare payments, the employer may get away with paying only €5,000. We should ensure all moneys employers owe the State are paid. Employers would think twice before unfairly dismissing an employee if, as I propose, many awards would double. Changes such as this should be made in miscellaneous provisions Bills aimed at tidying up matters.
While I have a few minor concerns about the proposals on family income supplement, the possibility of holding reviews halfway through the 52 week period is, in the main, a welcome change, which has been sought for some time.
I do not oppose the recovery of overpayments made by the Department, although I have raised concerns about this issue previously. While persons have only four years in which to claim back overpayments in tax, I am dealing with a case involving an overpayment by the Department that occurred 30 years ago. There is something of a disconnect in respect of the time permitted to recover overpayments. Fraud is a different matter and should be pursued. In the cases of overpayments made in error, the Department should write them off as hard luck after a certain period has elapsed. If the position were reversed, one would not have a hope in hell of claiming back a tax overpayment from Revenue because the onus is on individuals to ensure their tax affairs are in order and they do not overpay or underpay tax. Similarly, the onus should be on the Department to ensure it is not overpaying allowances.
It is damning that the respite care payment people receive today will be €325 lower than previously. Expenditure on social welfare has been reduced by €1.6 billion since the Minister took office, which is a substantial amount. As I stated, given the recent change in circumstances and the savings made in the Department, the Minister should start to reverse the reduction in her Department's expenditure by ensuring the savings made are redistributed to the most vulnerable.
By virtue of that going back into a local economy, it comes back to Government in many ways, such as through the employers' PRSI, employees' PRSI, VAT and PAYE of workers in shops and factories. In fact, it is a stimulus. There is a model that is used by the Department of Finance which shows how a stimulus returns so much to Government over a period. I do not have the expertise to give the Minister the exact figures but I am aware that if the Minister had used €1.5 billion as a stimulus over a period of three or four years, she would have had a return of two or three times its size which would be sustainable because she would have created jobs.
I welcome the changed circumstances in terms of the numbers working and the numbers who are no longer totally dependent on social welfare, but the major concern I have is the type of work that is being created. I refer to the significant numbers who will be dependent on family income supplement in the future because they are ending up in low paid jobs, with no permanency attaching in many cases. I have continually raised questions about the concentration on schemes that do not end up delivering full training or increasing suitability for employment, the keys ones being the likes of Tús, Gateway and JobBridge. The Minister and I will continue to disagree on those. I would encourage the Department to do a lot more in promoting the one job creation scheme that could be encouraged, that is, JobsPlus. That scheme is a model, where participants are in full-time employment, get a wage above the minimum wage and contribute PRSI and PAYE, and therefore their jobs are more sustainable because the grant to the employer is a lot larger.
I will leave most of the discussion on the technicalities and the specific points of the Bill to Committee Stage, which will be next week, where we can tease out in greater detail the impact of some of the changes which may not be as positive as they seemed initially. Most of the changes are positive, but I will oppose any change to the designation or mention of An Post in the Bill.
The next speaker is Deputy Finian McGrath, who is sharing time with Deputies Mattie McGrath and Boyd Barrett.
That is correct. I thank the Acting Chairman for the opportunity of speaking to this new Bill, the Social Welfare and Pensions Bill 2014. I welcome the debate on this legislation as we all need to be solid on the core principle of equal treatment between men and women engaged in activity in a self-employed capacity.
Before I go into the details of the legislation, it is important to remind those listening, particularly Members of this House, that when discussing pensions and social welfare issues, there are many out there for whom these are very important matters in their daily lives and in them simply surviving. In this day and age, that is the reality for many living in poverty. Social welfare can be simply a matter of putting food on the table, particularly following years of austerity. Those who are flippant about it and those in the Government and on the extreme right in this country who constantly demand cuts to social welfare need to wake up to that reality. Recently, when knocking on the doors, they got a wake-up call from the people. They all thought they were so smug until they got the answers on the doors. In this debate on legislative reform, we should never forget those who must survive every day on social welfare, particularly senior citizens living on pensions. Those on social welfare, whether they are low paid workers or the unemployed, all have to be protected. That is the bottom line.
I talk about low paid workers and the unemployed, but yesterday we heard the case of workers who are not getting any pay at all. Of course, I refer to day 14 of the sit-in of the Paris Bakery workers. They called yesterday at Leinster House, protesting about the way they are being treated. Twenty of the Paris Bakery workers held a rally with supporters outside Leinster House and I joined them. We all called on the Taoiseach to intervene urgently in their worsening situation. The workers were entering their 13th day of their Moore Street sit-in and are owed more than €100,000 in wages, holiday pay and redundancy pay. That is a scandal in 2014.
Ms Anissa Hosany, a chef with the bakery for over three and a half years, said:
The reason we began this sit-in was to get the money we are owed and make sure no more assets were removed by the owners. We feel like we are doing the job of the Revenue Commissioners, minding the assets of the company.
Mr. Eduard Claihnet, another Paris Bakery worker, said:
We are asking the Taoiseach to tell us how long the Government expects us to act on their behalf without stepping in. I want to go home, I want to sleep in my bed and not have the stress of this hanging over me.
Mr. Claihnet continued:
We want [the owners] to either pay us the wages we earned or agree in writing to wind up the company properly so we can access the insolvency fund. It is that simple.
The Paris Bakery workers are also calling on the Taoiseach to change the law immediately, and I would ask the Minister, Deputy Burton, to get involved. This should not happen to any worker. The insolvency payment scheme should be immediately accessible to all workers to protect them in cases where employers cease trading without formally winding up the business. That is what is going on in this country today and it is not acceptable. I am glad to say that many Members of the Oireachtas attended the protest on this issue yesterday.
In the Bill, we are talking about equality. I heard the Minister discuss in a recent interview the extremes that are popping up around Europe. My concern is the extreme right and the racism that is emerging right across Europe. Even up the road in Belfast in the North, we have seen in recent days the racism that is going on as well. We also have an added problem of sectarianism. It is important, regardless of political differences, that all Members of the House speak out on this issue. It is linked. If the Minister is serious about equality in society and in the Bill, she has to be serious about equality right across all sectors of society.
The Bill proposes a number of changes to a range of social welfare payments and requirements, including changes to the habitual residence condition and to the family income supplement. It seeks to transpose certain aspects of Directive 2010/41/EU. It also proposes amendments to the Pensions Act 1990 in respect of notifying members of defined benefit schemes where scheme benefits are being restructured under section 50 of the 1990 Act. That, essentially, is what the Bill is about. It is important that we get the detail of it right.
Another issue in dealing with this Bill on social welfare is the silent cuts over recent years to front-line services for those with disabilities. In that time, they have taken cuts of between 3% and 5%, but because of the rows about the salaries of the CEOs in Rehab and the CRC, the focus has been taken off the cuts to the front-line services. It is important that we highlight this issue in the debate as well.
In social welfare, we talk about protecting senior citizens and the vulnerable, including children. Two recent examples in my constituency have really got up my nose and I would ask the Minister to intervene urgently. The Jigsaw child care centre in Darndale, which is an excellent centre for preschool children, has 260 preschool children and 99 staff. They all come from the Darndale-Moatview area in Dublin 17.
They do an excellent job and I have been there to see the provision of front-line services. However, they are currently short €200,000 to keep the project up and running. We have asked the Taoiseach and the Minister for Children and Youth Affairs, Deputy Charles Flanagan, to intervene but everybody is sitting on the fence. If the Minister is serious about children's rights and social welfare, this particular project deserves support.
We saw recently that €2 million was found overnight to have an inquiry into the Guerin report, the former Garda Commissioner and issues like that. In addition, €800,000 has been found to refurbish the Fine Gael headquarters, yet we cannot get €200,000 for an excellent service for children in Darndale, which employs 99 people. I have raised this hypocrisy because if one is changing society, one must start with these things. They might be small matters compared with the billions in bank debt both here and elsewhere in Europe, but €200,000 should be given now for that excellent service in Darndale.
While the Minister is at it, she might also look at Darndale Park where there is a proposal for 14 jobs to clean it up and turn it into an excellent community park. Yesterday, however, I believe the Department of Social Protection turned down that proposal from the local residents' group.
The directive is concerned with the principle of equal treatment between men and women engaged in a self-employed capacity. Currently in Ireland, certain people who assist their self-employed spouse or partner in a business but who are not a business partner or employee are excluded from social insurance cover. The Bill provides for their inclusion subject to certain entitlement conditions. I welcome this aspect of the legislation.
Another section deals with family income supplement, FIS. Some 44,000 households are in receipt of FIS, while 98,679 children are included in the scheme. The average weekly FIS payment is €114.45.
I welcome the broader debate on this legislation but there is no point in talking about social welfare unless we do something for the weaker sections of society.
I am pleased to be able to speak on the Social Welfare and Pensions Bill 2014. I thank my colleague, Deputy Finian McGrath, for sharing his time with me.
I wish the Minister all the best in her current pursuits. She might have a new role and we might miss her.
A new supporter.
Thank you.
I have always been supportive of the Minister, Deputy Burton, in her difficult role in Cabinet and in dealing with the difficult issues there. Perhaps she will adapt a new slogan, "Joan's way and not Enda's way", instead of the current Tánaiste who said it was going to be "Labour's way or Frankfurt's way". Good luck to her agus go n-éirí an t-ádh léi.
I welcome some measures in the Bill, including proposed changes. I think it is time for change. Like the previous speaker, we can never underestimate how difficult it is for people at the margins of society. They include elderly people on pensions, many of whom have only one pension in the household, as well as the sick and disabled. During the lifetime of this Government there have been three serious attacks on them, which caused protests.
Family carers are taking an enormous burden off hospitals and the health system generally, which is creaking at the seams. They must always be at the forefront of our concerns as they are less well off. Over the years, they have paid into the system and have done the State some service by doing their best.
We should try to intervene with the workers at the Paris Bakery who are engaged in a sit-in. The way they have been treated is unfair. As a self-employed person and an employer for more than 30 years, I understand how difficult it is for all sides, but when such companies go into liquidation, it is not fair if workers do not receive their due rights. They should, and must, get them.
I disagree with section 7 which provides that increases in jobseekers' allowances, pre-retirement allowances, supplementary welfare allowances, disability allowances and farm assist payments in respect of the qualified adult recipient will not be payable for any period during which the qualified adult is resident, whether temporarily or permanently, outside the State or in prison or otherwise detained in legal custody. That is a bit harsh. The farm assist, for example, is a vital payment to keep families viable on agricultural smallholdings, particularly in disadvantaged areas. In addition, they might be trying to put children through college. I ask the Minister to make allowances for this.
I know the Minister goes to visit her good friend in Tipperary and is aware of that countryside's difficult terrain. People from disadvantaged areas may have to go abroad for temporary work with a landscape company, for example, or for training or a medical procedure. We should ensure, therefore, there is allowance made for that. I am not talking about people who go abroad to work on a full-time job. I am talking about people who leave to upskill themselves and gain experience abroad.
There is no change regarding the example cited by the Deputy.
I thought there was. I thank the Minister for that information. Clarity is required on the rules for entitlement to family income supplement. I ask the Minister to set out the circumstances in which a claimant who is living apart from his or her spouse or civil partner and children can still claim the supplement. That area needs to be clarified.
I welcome changes in section 10 in respect of the application of an habitual residence condition for entitlement to certain social welfare payments. It is timely for this matter to be examined.
Section 16 is a welcome measure for self-employed people as it extends social assistance cover to help spouses, civil partners or self-employed contributors. The social welfare code currently excludes from social insurance cover certain relatives, including spouses, civil partners or self-employed contributors who are participating in the person's business and performing the same or ancillary tasks. The Bill provides for the extension of social insurance to those spouses or civil partners where their annual self-employed income is within certain limits. The limits are small enough but that measure is important for family businesses where this matter is a huge issue. People may work night and day, using might and main, to try to keep a business afloat, although it is very difficult to do so. There should be, therefore, some cover for those people.
I welcome the move concerning self-employed PRSI. People with a reckonable annual income in excess of €5,000 will pay class S PRSI of 4% on all income, including unearned income, subject to a minimum annual contribution of €500. It might be a big sum if one does not have a lot of work, but none the less the Minister's efforts to change that position is important. We have cried out for such a change since the onset of the recession as so many self-employed persons have gone out of business through no fault of their own. They might have been employing ten or 20 people in the good times. Their employees, including tradesmen, all receive PRSI cover, and rightly so. However, the employer who was brave enough to take the initiative and create work gets nothing. That is very unfair, so I am delighted to see that the 2010 review will now take that into account. It is a welcome step.
I welcome the Bill's measures. The Minister has reassured me about the first issue I raised, so I thank her for that. I wish the Bill well in its passage through the House.
I wish to raise something that is not directly related to the Bill, although others have rightly brought it up, which is the Paris Bakery situation. I know the Minister was down there this week and many of us joined the protest yesterday. We have had a litany of situations like the Paris Bakery, including Vita Cortex, La Senza, Jane Norman and Connolly Shoes. Time and again, employers are simply refusing to give workers their entitlements, including wages and holiday pay, yet they can get away with it.
In the extraordinary case of Connolly Shoes, pickets have been in place for four years. The Government has been made aware of such situations time and again and nothing has been done. It is extraordinary that this can be allowed to continue. I can only assume it is due to Fine Gael's predilection for the idea that we must not do anything to hamper so-called enterprise, risk taking and entrepreneurialism, and if we took legislative measures to deal with this situation it might hamper so-called enterprise. It is unacceptable because this is enterprise where the workers take the risks.
There is no risk to employers because they can walk away from their obligations to workers. The employers take risks on behalf of workers without their knowledge. The workers discover one day that the business has been wound up, changed its name or found some other mechanism by which it can evade its obligations to its workers, who are left high and dry without a penny. Although this unacceptable situation has been known to the Government for at least two years, it has done nothing. Where is the emergency legislation on it? Although, sadly, I very much doubt it will be forthcoming, it must be said again.
There are three categories of provision regarding the Bill: positive provisions; provisions that are of deep concern or obnoxious; and provisions that should be there but are not. As one must put a positive foot forward in these often dark and grim times, I will begin with the positive elements. It is positive that equal treatment should be applied to self-employed people and particularly to their spouses and partners. For some time, self-employed people have been saying they would be happy to make the extra contributions that would mean their spouses and family members would be entitled to the same social welfare benefits as everybody else. This is a response by the Government to something self-employed people have been saying for some time, and I welcome it.
Similarly, the moves on family income supplement, FIS, seem positive in that they take account of changes in family circumstances, such as people moving apart, and will not exclude people from entitlement to FIS because of such changes. Although not a very positive issue, it is a step forward that where pension schemes are being restructured people should be properly notified of it and have some recourse to the courts. Although the details need to be examined carefully, I broadly welcome these positive provisions, in case anybody ever says we on this side of the House are only negative.
I never say that.
Some people do. I have major problems with a few elements of the legislation. The measures on recovery of overpayments are scraping the bottom of the barrel. I will give two cases without mentioning names lest the Acting Chairman jump down my throat. One mother, now a pensioner, told me her son, now in his mid-40s, was an apprentice chef when he was in his late teens or early 20s. At the time, 20 or 25 years ago, the Department of Social Welfare was paying his mother social welfare benefits for him on the basis that he was still in full-time education, but then told her he was no longer entitled to the money because he was an apprentice. She said he was in full-time education and therefore she had to look after him. The Department revoked the payment, she challenged it and it was restored. Although she thought it was resolved, 25 years later she received a letter informing her that two years of overpayments were to be deducted from her pension. That is outrageous and indicative of a Department that is scraping the bottom of the barrel. Somebody who is on a State pension, by definition living in poverty, will be driven further into poverty because of confusion and incompetence in the Department 25 years ago. She cannot even remember all the details.
In another case, about which I have telephoned the Department, a youngish man, approximately my age, in his 40s had some sort of overpayment issue approximately 20 years ago. Although he cannot remember the details, in his mind the issue was resolved back then, but 20 years on he does not have any evidence. The Department says it has overpaid him and is demanding the money back, and he does not have a leg to stand on. While in the courts there is a statute of limitations on debt - I think it is six years - the Department can go back 20 years, and it has all the cards because it can produce the evidence. Any nuanced, personal, detailed knowledge is gone and we are dealing with just pieces of paper and boxes being ticked.
The Government is scraping the bottom of the barrel to get money in while poor people on social welfare or pensions are being raided for lump sum payments, refunds or whatever the Department can get back. The victims of these raids can say or do nothing about it. It is unacceptable and brings to mind the question I have heard a lot on the doorsteps over the past few weeks as to how the Government can operate in terms of attacking the poor and the vulnerable. It seems there are no depths to which we will not sink to attack the poor and vulnerable in the money grab.
We can contrast it with how the wealthy and powerful are dealt with in terms of moneys owed. The Paris Bakery is a good example. Although I have said it on two or three occasions here it still galls me that the richest man in the country, who took over Sierra Support Services Group, the company which has got the contract to install water meters, had €100 million of his debts written off, mostly by Anglo Irish Bank, a public bank. In other words, his debts were written off by the same poor people we are talking about and by ordinary workers who have been hammered. We gave him €100 million. He also has a controlling share in Independent News and Media, and we wrote off €90 million of its debts. It is unbelievable when the poor are being hammered and we are taking bread off their tables. When the Government takes €10 or €15 from somebody on €188 per week, it is driving somebody who is already poor further into poverty. It is unacceptable. I ask the Government to think about the idea of trawling back 20 years and taking money from people where there is no fraud. In the vast majority of these cases there was an overpayment due to the Department's incompetence.
It is beyond belief, and it is one issue to which I am utterly opposed having included in the Bill.
I am concerned about another area, although I do not fully understand it and I want to hear from the Minister about it. This is the so-called strengthening of the habitual residency rules. From what I understand in reading the Bill, which is quite complicated and detailed, this will essentially allow adjudicating officers to reconsider whether somebody who has been determined as habitually resident and therefore entitled to a social welfare payment can continue to receive the payment. The review would happen on the basis that the person in question was not subsequently habitually resident in the State. Perhaps the person left the country or had a bank account in England, as many do, given our relationship with Britain, which means there is much activity back and forth. This happens because of the location of extended families or people having to do bits of work, leading to bank accounts or connections elsewhere. I suspect this will be another excuse to deny people social welfare entitlements, and I am concerned about that.
The detail of the issue must be examined thoroughly and perhaps the Minister will respond by telling me the process will be very fair. Excuse me if I am a little sceptical or concerned about that, given the issue I have just mentioned. There is a drive in the Department to scrape the bottom of the barrel looking for money and that often has pretty adverse consequences for people who really do not need the hassle of having payments cut off because of what is essentially bureaucratic box ticking. These are the two major issues about which I am concerned.
There is another issue I have discussed on umpteen occasions with the Minister of State, Deputy Jan O'Sullivan, the most recent of which was yesterday. It relates to rent allowance caps, provisions for which should be in the Bill but are not. I do not understand why that is so. I mentioned yesterday the case of a young woman in Bray with a severely autistic child who has been living in a hotel in Bray. As the summer holidays are approaching, the hotel can probably get tourist trade and it does not really want homeless people whose accommodation is paid by the Department, so it has engineered an excuse to kick out this woman. The woman has nowhere to go and having gone to the offices of Wicklow County Council, she was told it has nothing for her.
This woman has a child with severe special needs and what will solve her problem? Reviews are wonderful and I hope we can have a major social housing programme as we need to start building straight away. None of this will solve this woman's problem next week or today. The only solution to her problem would be the Minister telling the community welfare officer, ideally in legislation, that if somebody is faced with homelessness as a result of being unable to source private rented accommodation, the community welfare officer would approve him or her for a higher rent allowance cap based on what is available in the area. The woman I mentioned would then be able to look at www.daft.ie and see what is available for a mother with one child, such as a two-bedroom house or flat. In Bray, any suitable property would probably cost approximately €1,200 or €1,300 per month in rent and she will have to pay that in order to get a roof over her head. The community welfare officer can check it by looking at the property website before deciding the rent is reasonable and she can find a place to live. Only properties for rent at €1,200 or €1,300 per month are available and there is nowhere available at €975 per month. Such a provision should be included in the Bill and it is not too late for the Government to put it in. This must happen as otherwise, over the summer the homelessness crisis will spiral completely out of control.
Deputy Harrington is sharing time with Deputies Lawlor and Kyne.
I welcome the opportunity to speak on the Social Welfare and Pensions Bill 2014. In discussing the Bill, one of the more important tenets to consider is how we can help people trapped in options where even if they are offered work, it would make little or no benefit financially to take it up. I realise the offer of work may not come as often as I would like. I would have preferred more provisions in this Bill with that aim. Any of us on the doorsteps over the past month or more would have realised that it was a major issue. People, often in single income households, are forced to contribute heavily under different headings in the State but may feel angry at neighbours, friends, associates or family members who in their mind receive much from the State but contribute little while still having options. Where people do not have options it is a different ball game. There could have been greater emphasis on encouraging clients of the Department of Social Protection to look more earnestly at accessing the workplace and incentivising people within those households to get back to work where it is offered.
I welcome many of the provisions in the Bill, with one in section 16 essentially dealing with the protection of the interests of women under the social welfare code. An issue that has come before us many times is the example of a girl leaving school or college before entering the workplace and making contributions. When that woman gets married and rears a family, she would have worked in the home but she would have returned to work afterwards, continuing to make contributions. Such people may have expected to have contributed enough to earn a full rate contributory pension but unfortunately it may not be the case. Contributions are calculated but the manner in which the time worked at home is considered is unfair, and by assessing it over total years of work, the result is a small mean contribution over each year. The matter must be addressed because this issue of fairness greatly affects married women. It has come to light over the past few years and it will become a greater issue in the next couple of years.
The previous speaker mentioned overpayments and claiming back payments. He mentioned two cases from the total overpayment amount in 2012 of €97 million. The idea that we can disregard the section of the Bill dealing with overpayments defies logic. Overpayments arising from suspected fraud or customer error must be dealt with. We have heard staggering figures almost on an annual basis of the money recovered through effective fraud control measures within the Department. In 2012 the estimate was €97 million, meaning the rate is far too high.
Good fraud prevention measures will have to be a cornerstone of the work of the Department to make sure those entitled to benefits get the correct rate as set out in legislation. We have a relatively high rate of social protection within the European or OECD context. While that is good, it makes it harder for some families and parents to access the workplace.
Almost 8% of overpayments are departmental errors, which is high, even in the context of the €97 billion budget. Every effort should be made to wipe this out and put systems into the social welfare offices to ensure there are no overpayment errors. If a client is overpaid through departmental error, whether for a year, a week or 20 years, he or she has a case and the Department puts the chance of reclaiming that money at risk.
Very few will ever be told until they retire or claim the State pension what they are due. They will be given a contribution history, or part of one. When they ask where they stand with respect to their own pension, it is difficult to get accurate information. I can understand the reticence among some officials to state an amount, but it would help people who have contributed throughout their working lives to know what likely pension they will receive and how they might increase or improve their contributory pension. Some may wish to continue to contribute after they reach 66. They may wish to retire at 70 and would like to engage with the Department about how to get a greater contributory pension. That could be considered.
I welcome the development of the Intreo offices. More work needs to be done but the amalgamation of the social protection and community welfare office work and FÁS and An tSeirbhís Oideachais Leanúnaigh agus Scileanna, SOLAS, employees into a one-stop shop that brings people closer to the marketplace is very important. The Bill does not address this directly but I compliment the Department of Social Protection on taking that approach. It needs, however, to be rolled out further and faster throughout the State. It is an important initiative to get people back to work.
Some concern has been raised about payments through An Post. I am a postmaster. There is genuine concern that the contract for social welfare payments is being neglected. The departmental officials should keep in mind the consequences of disregarding how payments are made in the post office, particularly when it comes to fraud prevention, security and offering a more holistic service to clients. Quite often officials within the post office network have the information to help clients maximise their social protection service. That is not being taken into account and it is a shame it is not mentioned in the Bill.
I welcome the provisions in the Bill. There is work to be done to maximise the potential of social protection clients to get back into the workplace. That should be the objective of every Deputy as we move into a better economy.
I welcome the opportunity to speak on the Bill. I want to focus on Part 3 and an amendment I will table. Part 3 deals with notification to trustees of a change by the pensions authority to the members of the pension fund. My amendment will be on the definition of trustees, how they are elected and who has voting rights. This revolves around the deferred members who have no say in the election of trustees and therefore in the direction in which trustees take the pension fund. They might not get the information back from the pension authorities because they will have no rights as a body.
All members of the pension fund, whether active, retired or deferred members, should have the right to elect trustees. Deferred members may not have left of their own accord but because a company has wound up or because they moved to other employment. They may have left shortly before receiving their pension. They have no rights in the election of their representatives. My amendment proposes that they should have a say in electing the trustees of the pension fund.
I welcome this initiative and many of the changes planned in the Bill, particularly section 3 in respect of An Post. There is considerable concern about proposed changes to the contract with An Post. It is important for the viability of the rural post office network that it continues to have a role in the payment of social welfare. It would also be a control measure because the client must go in and collect the payment.
Some €19.63 billion will be spent on social welfare in 2014 and €18.5 million on capital expenditure. It is the largest spending category; almost €2 out of every €5 of Government spending goes to social welfare. It is important to have correct controls and safeguards in place in respect of the spending of this money to ensure best value for taxpayers.
It goes without saying that social welfare is an important safety net and provides support for a range of citizens, including jobseekers' supports and illness and disability supports. It is a safety net that most individuals and certainly most families at some stage in their life will rely upon. Such investment needs to be recognised. Ireland has one of the most substantial social welfare systems in the world and ensuring there is finance to underpin it is hugely important.
Debate adjourned.