I move: "That the Bill be now read a Second Time."
While this is a short Social Welfare Bill by normal standards, it none the less marks a positive shift in our economic and social recovery. That recovery is now clear to see. According to the European Commission, Ireland will be the fastest-growing economy in the EU this year, with our growth rate expected to hit 4.6% compared with an average of just 1.3% for other member states. Last month the Government delivered a budget package that reduced taxes for middle-income and low-income workers and provided welfare increases in a number of key areas, such as child benefit and the living alone allowance, which are the subject of this Bill. By any standards, this is a remarkable turnaround given the economic crisis this Government inherited upon taking office. In regard to the Trichet letter, which we discussed earlier, it is important to note that at that point, the deficit was 32%. It is incredible to contemplate the level of indebtedness that existed six years ago.
The main social protection measures contained in this Bill are an increase of €5 a month per child in child benefit from January 2015; a new back to work family dividend scheme to help people back to work; support for water services for certain social welfare recipients; an increase in the living alone allowance to €9 a week from January 2015; payment of a Christmas bonus of 25% to all long-term welfare recipients in early December; and a doubling of JobsPlus places from 3,000 to 6,000 and increased funding for JobPath. In addition, the decision to discontinue application of the 0.6% pension levy will be welcomed by pension scheme members and older people in particular as providing greater certainty regarding their retirement provision. I hereby notify the House of my intention to retain the weekly earnings disregard for recipients of one-parent family payment at its present level of €90 a week, which I will provide for by way of an amendment on Committee Stage.
On the subject of Committee Stage amendments, I take issue with recent comments in a prominent newspaper by a commentator generally regarded as being fair and balanced. He contended that the amendment to the Social Welfare and Pensions Bill enacted earlier this year to allow Irish Water to use PPS numbers was surreptitiously slipped into that legislation, which had no relevance to the matter. This commentator further claimed that the Oireachtas was not given sufficient time to understand the significance of the change or debate it adequately. The legislative basis for the allocation of PPS numbers, the purposes for which they can be used, the agencies to which specified-body status is granted, and offences for the misuse of PPS numbers are set out in the Social Welfare Consolidation Act 2005. The extension of specified-body status to different agencies for the purposes of using PPS numbers is a common feature of most Social Welfare Bills. In the circumstances, the Social Welfare and Pensions Act 2014 was the most appropriate legislative vehicle to provide for the extension of specified-body status to Irish Water.
While the extension of specified-body status to Irish Water was provided for by way of a Committee Stage amendment to that Bill, I indicated to Deputies on Second Stage my intention to table the amendment. In addition, in advance of the Second Stage debate, officials from my Department briefed the Opposition spokespersons on social protection, other members of the Oireachtas and their research assistants on the contents of the Bill, including the proposed Committee Stage amendment enabling Irish Water to use PPS numbers. During this briefing session, my officials answered questions relating to the operation of this provision. Moreover, a detailed briefing document, including information on this particular Committee Stage amendment, was given to all those who attended the briefing session and was subsequently circulated more widely to Deputies and Senators. Therefore, the contention that this amendment was somehow surreptitiously slipped by an unsuspecting Oireachtas is both inaccurate and insulting to Members. I will deal with the issue of the use by Irish Water of PPS numbers in more detail later.
In the six years since the banking collapse, very difficult decisions have had to be made in the area of social welfare provision. Nevertheless, in my time as Minister for Social Protection I have been able to prioritise the protection of basic social welfare rates and maintain a social welfare safety net that is among the most effective in the EU at reducing poverty. We are now realising the benefits of the sacrifices that have been made by the Irish people, as we emerge from the unprecedented economic crisis that impacted so significantly on the country and into which we were plunged by the fatally flawed blanket bank guarantee. Budget 2015 reinforces the improvements in the economy by sharing the gains of our recovery in an equitable and sustainable manner. My aim is that this Bill, together with the other measures announced in the budget, will begin the process of restoring living standards for families, older people and low-income and middle-income workers. I am very pleased that it has been possible, for the first time since becoming Minister for Social Protection, to provide for modest increases in social welfare payments.
In recognition of the sacrifices that were made and the difficulties still faced by families, the Government's Statement of Priorities, published earlier in the year, promised a new deal on living standards for low-income and middle-income families. In line with this commitment, the Bill provides for a €5 increase in the rate of child benefit, as announced in budget 2015. This will bring the monthly rate of child benefit from €130 to €135 per child, with effect from 1 January 2015. The Government has also committed to increase the monthly rate of child benefit by a further €5 in 2016, if circumstances allow. Child benefit has been critical in supporting families through difficult times and this increase will help families to build a better financial future and boost the recovery. This additional support for children is also in line with the key conclusions of the recent UNICEF report, which states that "increasing investment in social protection policy and programmes can reduce poverty, enhance social resilience in children and support economic development in an efficient, cost-effective way."
Child benefit, along with other child income supports paid to welfare recipients and low-paid working families, helps to prevent poverty. Following the changes we are implementing, the Government will provide a combined weekly payment of €63 for vulnerable children. These and other social transfers greatly reduce the at-risk-of-poverty rate for children from 45% to 19%. I am a strong advocate of child benefit as a universal payment because of its crucial importance to low-income and middle-income families. A crucial element of a strong and sustainable welfare system is the principle that everybody contributes and that the system is there, in turn, to support those contributors at key stages in their lives. Child benefit is one of the few universal payments in the welfare system and its universality has an important role to play in maintaining the sustainability of the system. Moreover, the fact that every family receives child benefit, regardless of employment status, ensures this payment does not act as a disincentive to work.
The live register figures for October, which were released this week, confirm the continued improvement in the labour market. In the first nine months of this year, 113,000 people left the live register to take up employment. What is more, this growth in employment was entirely accounted for by full-time jobs. Unemployment is down from a crisis peak of 15.1% to 11% now. That is still far too high, but the pace of the reduction in unemployment is accelerating. I am confident that we will get unemployment below 10% in the next 12 months.
Employment creation remains a central focus of Government policy. In particular, we want to ensure people who lost their jobs during the crisis will benefit from the strong economic recovery that is under way. A vital part of the Government's strategy is the need for additional activation measures in the interim while the economy recovers. That is the rationale behind our activation strategy, Pathways to Work. In order to support the implementation of Pathways to Work, €1.6 billion is being made available in 2015 to provide approximately 300,000 work and training places.
The number of positions on JobsPlus will be doubled to 6,000 with a focus on young unemployed people at a cost of €13.5 million in a full year. Under the JobsPlus scheme, monthly cash grants are paid to employers to help with wage costs when they recruit long-term unemployed jobseekers.
I am also introducing a new incentive called the back-to-work family dividend which will help jobseekers with families to return to work. This dividend will provide an incentive of €1,550 per child in the first year of employment or self-employment and half that amount in the second year. This scheme, which will come into operation in early April 2015, will cost €22 million in 2015 and €46 million in a full year. The necessary administrative and technical details of this dividend are being developed and will not be finalised in time for inclusion in this Bill. Instead, the required legislative amendments will be provided for in a further social welfare Bill to be introduced early in the new year with a view to its enactment by the end of March 2015 so the dividend can commence early in April 2015, as provided for in the budget. The 2015 social welfare Bill may also provide for several other changes to the social welfare code arising from policy, administrative, operational and control matters. This measure, when taken together with the employer incentives under JobsPlus as well as the activation measures under the JobPath scheme, will ensure that people who have remained on the live register for a prolonged period can also benefit from the recovery in the labour market.
The ongoing task of economic repair must be accompanied by an equal focus on social recovery. Following several budgets which required a major consolidation of the public finances, including social protection expenditure, budget 2015 provides that all social welfare payments and supports will be maintained during 2015. This means there will be no reductions in payment levels and no changes in eligibility criteria. However, the improved economic circumstances have allowed us to go beyond this. Accordingly, I am also providing for the first increases in weekly social welfare payments since 2008.
The living alone allowance, payable to some 180,000 pensioners and people with disabilities, is being increased from €7.70 to €9 a week. We are also in a position to restore partially the Christmas bonus this year. A bonus of 25% will be paid in early December to all long-term welfare recipients, including pensioners, lone parents, jobseekers, carers and people with disabilities.
While these increases are modest compared to those provided in the recent past, they are also prudent. We will not return to the recklessness of the past. Instead, we will use the economic dividend from the recovery to invest in sustainable growth, in families and communities and in vital public services.
Budget 2015 provides for several other social protection measures, including helping vulnerable welfare households to meet the costs associated with water services. In addition, my colleagues and I are looking at the possibility of further options whereby every single household receives help with their bills.
Budget 2012 provided for a phased reduction between 2012 and 2016 in the weekly amount of earnings that can be disregarded for the purposes of the one-parent family payment scheme, with the disregard due to fall from €90 to €75 next year and to €60 in 2016. I am pleased to announce that I have provided for the retention of the weekly earnings disregard for recipients of one-parent family payment at its present level of €90 a week. This measure will be provided for in a Committee Stage amendment I will be tabling. This will benefit some 28,000 working recipients of one-parent family payment during 2015 at a cost of €8 million. In addition, the back-to-work family dividend will be of significant financial assistance to lone parents looking to return to work.
I want to assure Deputies and the public about the uses that can be made by Irish Water of the PPS, personal public service, numbers that are provided to it. Irish Water has confirmed that validating eligibility for water allowances is the sole purpose for the collection and storing of PPS numbers. While the exact processes are yet to be developed, it is important to reiterate that the Department of Social Protection will not be giving any additional information to Irish Water. The intention is that the PPS number will serve as a unique identifier in the case of individual Irish Water customers. It will be used by Irish Water to facilitate and control the distribution of allowances which are subvented by the Government. The Department will simply be providing validation of information that Irish Water has collected and provided to the Department.
Irish Water has indicated PPS numbers will only be shared with the Department of Social Protection and only for the purposes of verifying the applicability of water allowances to a customer's account. This is to confirm eligibility for the allowances and to ensure a customer claims allowances only once rather than at multiple properties. Social Welfare legislation specifies that the PPS number can only be used by specified bodies and agents acting on their behalf and only for the purposes of public service transactions. Provision is also made for sharing a person's PPS number between specified bodies.
The PPS number is the unique identifier introduced in 1998 and is used to provide access to an important range of public, civic and other services. It replaced the Revenue and Social Insurance, RSI, number, introduced in 1979, for engagements between individuals and Revenue or social welfare. The introduction of the PPS number made it accessible by specified bodies, rather than just Revenue and social welfare, in transacting public services. At its core, the PPS number is a device to assist in and to enhance the efficiency of the provision of public services to members of the public. Those public services vary greatly. Accordingly, the PPS number is used widely by, for example, all employers in their transactions with Revenue and the Department of Social Protection, in the delivery of social welfare payments and services including dental, optical and audiological services provided by the private practitioners, financial institutions and the health and education sector.
It is an offence for persons other than specified bodies, their agents or those to whom the number refers, to use PPS numbers or otherwise seek the disclosure of same. The Department is committed to protecting and facilitating the use of the PPS number in accordance with the law. In this regard, it monitors compliance with legislation among the specified bodies and deals with identified and reported cases of misuse. The collection, storage and use of the PPS number is also subject to the provisions of the Data Protection Acts.
Section 1 provides for the definition of the term the "Act of 2012" which is used in the Bill to mean the Social Welfare Act 2012.
Section 2 provides for a €5 increase in the monthly rate of child benefit, bringing the current rate up from €130 to €135 with effect from 1 January 2015. This increase represents an annual increase of €60 for each child, bringing the overall annual investment through the child benefit system to €1,620 for each child. This measure will benefit some 1,171,700 children in 612,800 families. Section 2 also provides that in the case of twins, the monthly rate of child benefit will increase from €195 to €202.50 per child, while in the case of multiple births of three or more children, the monthly rate of child benefit will increase from €260 to €270 per child, with effect from 1 January 2015. Section 3 provides for the Short Title and construction of the Bill.
Despite the need to stabilise the public finances over the past number of years, the Irish social welfare system continues to play a key role in our society and I have ensured that the necessary resources have been made available when required. We have made substantial progress in repairing the enormous damage that has been done to the Irish economy and to our society, initiated by the fatal bank guarantee of Fianna Fáil and the Green Party when in Government.
The social protection measures contained in this Bill and in budget 2015 are built on the foundations of the economic recovery. It is none the less recognised that there are still many difficulties that need to be addressed. While these measures represent a modest start, we will not imperil this recovery by returning to the reckless policies of the past. Instead, we want to sustain the economic recovery and build the social recovery, so that every person, family and community feels the benefits of it.
Today saw the publication of a letter from the then head of the European Central Bank, Mr. Trichet, to the then Minister for Finance, the late Brian Lenihan. When one sees the tone of that letter and the data pertaining to the Irish economy during that snowy winter of 2010, one has to say that they were incredibly difficult times for everybody. We have come through some difficult years but people are returning to work. In addition, our target for the budget deficit in 2015 is below 3%, at 2.7%. Compared to a period when the deficit soared to 32%, one can see the turnaround.
Many people suggested it would have been better to throw our hands up and not work to repair Irish society. We have seen examples of other societies that chose that route, but two decades later they are still in an incredibly difficult position. We are now able to raise debt on international markets at extremely competitive and favourable prices, just slightly above the German price of debt.
I realise it has been difficult for a lot of families but I am pleased to bring these budgetary measures, including the Social Welfare Bill, before the House. They are positive and hopefully will set the tone to continue our economic and social recovery. This will widen and deepen, reaching everybody and every area of the country, including cities, towns and villages.