Vol. 923 No. 3
6. Deputy Joan Collins asked the Minister for Social Protection if it is within the remit of the JobPath scheme to send persons forward for jobs that they are not legally qualified for, with the result that the JobPath participant will have to pay a substantial amount to gain the qualification and take up the job on offer. [28784/16]
18. Deputy Joan Collins asked the Minister for Social Protection the number of complaints received by the companies running JobPath and by his Department. [28782/16]
151. Deputy Joan Collins asked the Minister for Social Protection if he will ensure that those selected for JobPath are not denied other opportunities that may arise for them, in particular, opportunities arising from the social inclusion clauses in State projects, for example, the construction of the national children's hospital. [28785/16]
Will the Minister give an overview of how JobPath operates?
I propose to take Questions Nos. 6, 18 and 151 together.
JobPath is a new approach to resourcing the delivery of employment services to people who are long-term unemployed. Two service providers, Turas Nua and Seetec, are contracted to work with people who are long-term unemployed. These contractors supplement the work of the Department’s own case officers and the local employment services. JobPath does not replace or substitute for these services. It provides additional capacity to the Department in order that it can extend the case management approach of delivering employment services to people who are long-term unemployed.
Participants on JobPath are not required to fund unreasonable training expenses to compete for jobs for which they are not qualified. On the contrary, participants are provided with a range of training and development supports, including career advice, CV preparation and interview skills. On a case-by-case basis, the service providers also provide funding for items such as personal protective equipment, tools, work clothing and Private Security Authority licences. It may also arrange specific skills training if required by a jobseeker to apply for particular types of jobs. All of these supports are designed to help the jobseeker compete for and secure appropriate employment. If the Deputy has a specific case in mind where a jobseeker was required to incur unreasonable expense, I will arrange to have it investigated by the Department.
To date, 62,000 people have been referred to JobPath. Up to 119 complaints have been recorded, less than 0.2% of referrals. Some 76 complaints have been finalised and 43 are still being processed.
Participants on JobPath have access to the same range of job opportunities as all other jobseekers, including those arising from social clauses in State contracts. Some JobPath participants have already been put forward for jobs on the national children’s hospital contract.
I have had a few constituents giving me their experience on JobPath. One was working in a primary school, providing a breakfast club service. Due to cuts, she became unemployed. She was randomly chosen by the Department to go on the JobPath scheme with Seetec. She ideally wanted to go back to working in a school environment but was barred from applying for a suitable CE scheme due to being on the JobPath scheme. She was offered opportunities for jobs but with a low number of guaranteed hours or no guaranteed hours. She was told she would have to go into training for dealing with care of the elderly, which would cost her €700.
Anecdotally, it seems Seetec puts many people forward for these types of job and the receiving company not only gets a worker on low wages with no full-time hours, but a kickback from the training company. The constituent in question felt she was effectively owned by Seetec and had to do what it said, even though she had interests in other areas for which it was not giving her any option.
If the Deputy gives me details of that complaint, I will certainly have it investigated.
I do not want to be speaking about an individual without knowing anything about his or her case. However, it is important to say that if one is in receipt of jobseeker's allowance, one is receiving a payment from the taxpayer. A condition of that payment is that one should seek and take up employment. The job may not and probably will not be a job forever or the job of one's choice but it is not the case that one can continue to draw a welfare payment at the expense of the rest of society until one finds the job of one's choice or the job one really wants. It is conditional. That is the basis of the payment. It is not that people are entitled to receive €180 or €200 per week until they find their perfect job.
I apologise to Deputy Joan Collins. Since there are two questions in her name, she has extra time.
The Minister's remark is terrible because people are not on jobseeker's payments because they want to be. People want to work and the girl in question wanted to do so. The only option she was given was a job for which she was told by the company at the interview she would have to be retrained at a cost of €700, and that this would have to come out of her own pocket.
This is not a question of people scamming the system. From the way the Minister put it, that is what he was trying to intimate. This issue is about people who want to get work. They want good work. The job in question had no guaranteed hours and the woman did not know whether she was going to get five hours, 20 hours or 15 hours with the company to which Seetec referred her.
I will certainly send the case, along with another two or three, to the Minister for him to investigate. Does he agree that the JobPath scheme is probably exploiting people? Will he investigate that? Why are these companies, Seetec and Turas Nua, dealing with the contracts when it should be the Department of Social Protection? Questions arise in this regard that we must ask and investigate.
The reason they do so is because they provide additional capacity. We have a limited number of staff. They are all tied up in Intreo offices and with their current work. We needed more capacity and the experience of companies involved in recruitment and successfully placing people in jobs. That is what they are doing.
I will definitely look into the issue of training costs. What happened certainly sounds like it should not have happened.
To return to what I said earlier, there are many people who may wish to work in a school but, for some reason, cannot do so and must work somewhere else. There are many people working hard and paying taxes who do not necessarily have the job of their choice or dreams. They are the ones who pay for the welfare system. It is not the case that somebody can continue to draw down a welfare payment and refuse employment. That is not an opinion; it is actually the law.
What is the process for randomly choosing people for JobPath after they have been unemployed for a year? Do the authorities just pick a number or push a button? Are names put forward? How much have the companies operating the scheme received overall? How much did they receive to place individuals in employment?
People are not averse to work. Before the crash, there were high employment rates. People were working away and getting paid. It is because of the crash that people lost their jobs. It is those people who are trying to find jobs now. They are willing to work but if they must pay for training or if they are not given a job with proper hours, it is not satisfactory. Does the Minister agree with that? Does he agree with people being moved from the dole to a job for which there is no guarantee of one's hours? One might not know whether one will get 20 or 15 hours or what one will earn at the end of the week.
A number of questions were asked and I will have to respond to the more detailed ones by correspondence because I do not have the relevant information in front of me. People are selected for JobPath by the Department based on their being long-term unemployed, or unemployed for more than a year. Essentially, they are with JobPath for a year. They are often people who have been on community employment schemes but did not manage to find a job afterwards. Some people still do not find a job even after their having been in JobPath for a year. They could go back into other options at that point.
The Deputy is absolutely correct that unemployment soared because of the collapse in the economy. The rate is now way down. The live register figures were published today. For the first time since 2008, the number on the live register is below 300,000 and the unemployment rate is below 8%. We are now setting a more ambitious target, to bring the rate of unemployment down to between 5% and 6% by the end of 2020 and the rate of long-term unemployment down to 2.5%. However, that will involve much more one-to-one engagement with jobseekers to help them to get into the workplace.
If one makes a complaint, one must do so through Seetec, a private company. If one is not happy, one must go to the Department of Social Protection. Why can the person not go directly to the Department in this regard?
As part of any complaints procedure, the JobPath provider investigates and attempts to resolve the issue or complaint immediately in line with the customer complaints procedure. However, if that is not possible, it will record the details of the complaint and acknowledge it has received it. It will give the client a contact name and telephone number and, where it is at fault, apologise and correct the error as soon as possible, in addition to providing an explanation if for any reason the complaint cannot be resolved. If the client remains unsatisfied, he or she can request the Department to carry out a review. If he or she is not satisfied with the outcome of the Department's review, he or she can then refer the matter to the Ombudsman. That is the normal complaints procedure in most cases. One makes the complaint at the coalface first and if one is not happy, one can refer it to the next responsible body, which in this case is the Department, or, finally, to the Ombudsman.
7. Deputy Paul Murphy asked the Minister for Social Protection if he will provide an update on the replacement of the JobBridge scheme; the safeguards to defend the rights of participants that are envisaged; and if he will make a statement on the matter. [28793/16]
Will the Minister provide an update on his plans for JobBridge 2.0, the replacement of the JobBridge scheme? In particular, will he take into account the findings of the internal audit of his Department, which were absolutely damning and paint a picture of a scheme characterised by exploitation and abuse in its very design. The system is described as being based on self-declaration by the companies. Will that be taken into account in the scheme the Minister is now cooking up?
JobBridge was introduced in 2011 in response to the unprecedented collapse in the economy, particularly the sharp increase in unemployment. Since then, it has enabled over 19,000 employers, mainly small ones, to provide work experience and job opportunities to over 48,000 jobseekers. Independent research suggests it has helped about 30,000 of these jobseekers to secure paid employment.
Since JobBridge was introduced, labour market conditions have improved significantly, with unemployment down from over 15% to under 8% and the live register figure falling to below 300,000 for the first time since 2008. Given these improvements, I have already announced that I plan to discontinue the scheme with a view to replacing it with a new one better suited to the economy as it is now.
It is important that the design of any new scheme be informed by the best available evidence. That is why I intend to wait for the results of a second independent evaluation of JobBridge before finalising the design of any replacement scheme. The evaluation is being undertaken by Indecon International Economic Consultants in association with London Economics. It includes a detailed econometric counterfactual analysis, a cost-benefit evaluation and a large-scale survey of jobseeker and employer opinions. The results of this evaluation will provide insights that are more reliable than the anecdotal opinions or small-sample surveys that have informed much of the debate so far.
I have also asked the Labour Market Council for its views on how a new scheme should be designed. The Labour Market Council includes representatives from the Irish National Organisation of the Unemployed, the Irish Congress of Trade Unions and Ibec, together with some distinguished labour market economists. Indecon is currently finalising its report on JobBridge. The Labour Market Council has met Indecon on a number of occasions to review its work and will submit its own observations on the Indecon report. I expect to receive the final version of the report within the next two weeks and will publish it, together with the Labour Market Council observations and my own proposals, very shortly thereafter.
The Minister referred to a high level of criticism based on anecdote or very small-scale surveys by various interest groups. Leaked to RTE's "This Week" programme was an internal audit from the Minister's Department that is not based on small-scale surveys by various interest groups. It is an extensive audit and it paints a picture that blows a complete hole in all the spin of the Government and its predecessor on JobBridge. The most fundamental point is that "It is not possible to verify whether the internship is displacing a potential job vacancy". It refers to a nightmarish set of circumstances in which 15 schools have no special needs assistant, SNA, posts allocated but have SNA interns.
According to the report, "587 cases identified with graduate, intern or trainee in the title of the advertised position", despite the fact that it was against the rules. Did the Minister have the report in his possession when, on 31 May, he told me JobBridge was a highly successful scheme? On 18 February, the Secretary General of his Department had a report which said it was anything but a successful scheme and that all the spin the Minister has been trotting out about JobBridge was untrue.
I did not have it at that time. When the Deputy sees the Indecon report, he will see, if he is interested in the facts, that it has been a highly successful scheme, given that those who took part in it were much more likely to be in employment subsequently than a similar control group with the same sort of background and education who did not take part in it. I hope the Deputy will read the report with an open mind.
I am not sure if the Deputy knows how an audit cycle works or has ever been involved in doing one. In an internal audit, auditors go through a scheme or programme and raise questions. Then, the Department, corporation or NGO must respond to the questions raised. The auditors were satisfied with the responses they received to their questions. This is how an audit cycle works.
I am interested in asking the Deputy a question. It is interesting that he is already gearing up to oppose whatever scheme replaces JobBridge. He is already calling it "JobBridge 2.0", which is the rhetoric he intends to use. Will the Deputy automatically oppose any new work experience scheme, or is there any work experience scheme he could possibly support?
Did the Minister read the responses with which they defended JobBridge? Schools that did not have SNAs advertised for SNAs. It is impossible that those people will be properly trained as SNAs in those schools. The response was:
JobBridge guidelines do not indicate that a like for like job to internship must exist within any given sector. In relation specifically to the education sector it is felt that an SNA intern will be working with a teacher.
It is a joke of a response. The report is damning. I have read all the responses. The last time there was an Indecon report, the then Minister, Deputy Joan Burton, dressed it up and spun it around and got a magical figure of 61% success. However, if one excludes those who got a job via a PRSI scheme, the success rate is 17.6%. It is less than the 29% of employers who said to the first Indecon report that if JobBridge did not exist, they would have been highly likely or fairly likely to employ somebody.
The reason I will oppose any scheme which is about people working for free is because I am against the exploitation of people and because I know it results in job displacement, as indicated in the internal audit, and acts as a downward pressure. Based on the Minister's response to Deputy Collins earlier, I suspect he is in favour of those things.
Since taking up this post, I have gone around the country and spoken to a lot to staff of my Department working in the Intreo centres with jobseekers. To my surprise, the vast majority of them, if not all of them, are enormous advocates of JobBridge and have asked me not to discontinue it.
The Minister should talk to people who have done JobBridge.
Part of the Indecon report is a survey of people who have done it. While not everybody agrees, the vast majority of people had a favourable opinion on 18 of the 20 issues they were asked about in the survey. I know people who took part in JobBridge. We had some of them in the Department of Transport, Tourism and Sport, and they are all in good jobs now. They may not be the people who are attending the Deputy's meetings or rallies or joining his party. They have taken part in JobBridge and have done well. However, the economy is in a different place and we no longer need JobBridge. However, we should not throw the baby out with the bathwater and get rid of the opportunity for people to get work experience in the private sector with a real employer. There are not many opportunities to do so with the existing schemes.
This is not dealing with the reality of what is in the internal audit. The internal audit is damning. It shows the rules that existed were not even being applied, that there was no way of working out whether job displacement was taking place, that when more than 500 companies were advertising in a way that was against the rules, nobody did anything about it. The scheme was designed to be exploited by companies. In his opening response, the Minister said 19,000 employers got the opportunity to take people on. It is great for the employers who get free labour. From the evidence that is publicly available so far - let us see the second Indecon report - there is no indication that JobBridge enables people to get real jobs as opposed to exploiting them.
There will always be a degree of displacement and dead weight in any employment activation scheme. The same applies to the community employment, CE, scheme. It is an employment activation scheme which I think the Deputy supports. I have never heard him calling for it to be shut down. It provides services such as meals on wheels and home helps. People on CE schemes do very good work which otherwise would probably have to be tendered for and paid for. Any scheme that gives people a degree of work experience will have a certain degree of displacement. Is the Deputy saying we should shut down all the schemes - Gateway, Tús and CE?
I am saying people should be paid for work.
8. Deputy Gino Kenny asked the Minister for Social Protection if he is still of the view that the one-parent family payment was not cut by the previous Government; and if he will make a statement on the matter. [28732/16]
Does the Minister for Social Protection stand over his assertion that the one-parent family payment was not cut by the previous Government, and will he make a statement on the matter?
The predecessors to the previous Government introduced two cuts to the weekly rate of the one-parent family payment in budgets 2010 and 2011. When the previous Government took office in March 2011, there was a commitment in the programme for Government to maintain core weekly social welfare rates. This commitment has been maintained as the rate of the one-parent family payment has been maintained at €188 a week throughout the course of the Government. However, the previous Government reduced the income disregards that recipients of the one-parent family payment can receive when they are working. This resulted in a reduction in payments for some lone parents who were working while receiving benefits. The reforms also changed the conditionality around the one-parent family payment, including lowering the maximum age threshold for the youngest child to seven years of age.
The purpose of reducing the age thresholds of the one-parent family payment is for my Department to engage with lone parents with the aim of providing them with enhanced access to the wide range of education, training and employment supports that are available. Now that the economy is back on track, due to the policy decisions made in recent years, there will be no need for further cuts to welfare payments. Unemployment is down by almost half, incomes are rising again and the public finances are back in order, demonstrating that we followed the right course politically as a country.
The 2016 budget improved the means test and increased the earnings disregards for lone parents in receipt of the jobseeker’s transitional payment. Other measures which benefited lone parents included the €5 increase in child benefit, an increase in fuel allowance of €2.50 per week - the fuel season began last week - and a 75% Christmas bonus. I am strongly of the view that welfare should be seen as a second chance or safety net. For this reason, any future reforms affecting lone parents will concentrate on making child care more affordable and work more attractive and reducing barriers to education rather than more welfare.
The plan is probably the most ill-thought-out and ill-funded policy of the past four or five years. There are more anomalies and holes in it than any other social welfare policy of the past five years. It has compounded poverty among lone parents. While the Minister is right that it has not touched the core value of the one-parent family payment, it has touched the income of a parent going out to work. Will the Minister comment on it? The income of a parent in receipt of the one-parent family payment has been dramatically cut. I will give the Minister the details after he has responded to me.
I acknowledge that the disregards for some lone parents' payments have decreased. If the Deputy is referring to the "Morning Ireland" interview, I have no difficulty in accepting that what I said, while it was not untrue, was not the full facts.
That is untrue in any man's terms.
I had in mind a lone parent who was in receipt of the basic payment, not also working and receiving benefits. I will give the Deputy the figures, if he is interested. As a result of the changes made in 2015, 47% of lone parents, 12,000, experienced no change in their incomes; 12%, 3,000, saw an increase in their incomes; and 19%, approximately 4,900, suffered an income loss, as did 5,700 family income supplement, FIS, recipients. I hope the Deputy will acknowledge in his reply that some people's incomes increased.
I am happy to acknowledge that, at least under those reforms, approximately 59% had no change or were better off and 41% lost income. The changes were not perfect, but those that we make in future in respect of lone parents will be to assist them with the cost of child care and helping them into education, not to make it easier to get more welfare, which is not the right way to go.
The Government is taking money off them.
I will list the main points in terms of income. The qualifying age was cut to seven years and income disregard was cut from €147 to €90, which meant a loss of €28.80 per week for working parents. According to the most significant stat, if a lone parent worked 20 hours for the minimum wage in 2015 and got FIS, he or she would have been down 17% compared with what he or she would have been getting in 2011. If a lone parent worked 28 hours, he or she would have been down 14%. If a lone parent worked 35 hours, he or she would have been down 11%. This is discriminatory. This is what puts lone parents back in the poverty trap. The Government is discriminating against people who want to go out and work. This is a political attack on lone parents by Fianna Fáil, Fine Gael and the troika.
The Deputy has gone over time.
We can cite lots of statistics to each other. If the Deputy had been here for the-----
These are facts.
Please, let the Minister continue.
I will give the Deputy some other facts.
No, these are facts.
Will the Deputy please allow the Minister to continue?
It is remarkable how the Deputies asking questions during Question Time have no interest in hearing the answers-----
I will listen.
-----because they might have to tolerate a contrary-----
I am listening.
-----opinion or hearing some other facts.
Take off the rose-tinted glasses and look at the harsh reality.
Please, allow the Minister to reply.
These are the facts from the quarterly national household survey of the second quarter of 2016. In the year commencing 1 July 2015 to 30 June 2016, the number of lone parent families in employment increased significantly by 3.6% to 56.4%. For those whose youngest children were aged between six and 11 years, the percentage in employment increased by 7.5% to 57.2%. More lone parents are getting into the workplace. The best way out of poverty is by getting more people back to work. If we are going to make any change under my watch, it will be to assist more lone parents in returning to work, with child care costs and in breaking some of the barriers to education.
Where is the child care?
What the Deputy seems to want to revert to is a system of more welfare. That is not right.
No. The Minister is an ideologue.
We have had adequate time to deal with-----
And the Deputy is not? Has he no ideology at all?
I have an ideology. I have a great ideology.
Thank you, Minister, Deputy.
Should I take that as a compliment, then?
9. Deputy Clare Daly asked the Minister for Social Protection whether he is concerned, particularly with the quickening demise of occupational pension schemes, that inadequate governance can lead to employers unilaterally closing down pension schemes without consulting and negotiating with all those who are affected by these actions, not just trade unions but those who may appear not to be allowed have representation, namely, pensioners and deferred members; his plans for same; and if he will make a statement on the matter. [28777/16]
I am sure that none of the Deputies would like to take up Deputy Clare Daly's time. She is entitled to it.
I thank the Acting Chairman. This question relates to pensions governance, in particular the role of trustees, including corporate trustees. It concerns workers who make contributions in order to have decent retirement incomes but where decisions are made that affect their livelihoods in retirement and deplete their returns. These workers are basically disenfranchised from having any control over the trustees who, by virtue of their decisions, enrich themselves. What plans does the Minister have to improve pensions governance in this regard? I will cite an example after his reply.
As the Deputy is aware, the decline of defined benefit pension schemes accelerated during the financial crisis to the extent that the whole pension sector was possibly at risk. In recent years, the Government has amended pension legislation to protect the pension sector and ensure fairer and more equitable outcomes for all members of schemes.
Neither the Minister for Social Protection nor the Pensions Authority has the power under legislation to intervene to freeze the winding up of a scheme or to compel the employer to make contributions to a scheme. Almost all Irish defined benefit schemes have a rule that allows the employer to cease contributions, usually after a notice period. There is no legislative obligation on the employer to make contributions and no further liability on the employer where contributions cease. Neither is there an obligation on the employer to give notice to members or to consult in advance of ceasing contributions. However, in the case where a restructuring of benefits is proposed, pensioners, deferred scheme members and unions must be kept informed by trustees. Furthermore, changes made in 2015 require trustees to notify groups representing the interests of pensioners and deferred scheme members in a scheme in such a situation.
The Department and the Pensions Authority are working on proposals for the reform and simplification of pensions, the purpose of which is to impose higher standards on all occupational schemes. Standards in respect of pension schemes will be further enhanced by the transposition of the new IORPS II directive within the next two years.
I am not sure if the question was clear and I do not expect the Minister to be on top of every example of a pension scheme, but I will put a scenario to him and he might advise on how it can be addressed.
The Aer Lingus supplementary pension scheme was attached to the defined benefit Irish Airlines Superannuation Scheme, IASS. The IASS closed and, as a result, the Aer Lingus scheme closed and was frozen. That was over two years ago. The fund contains more than €108 million and has approximately 2,500 members. The trustees have delayed the winding up of the scheme. As the Minister knows, a wind-up process can take up to a year. In that time, workers have retired. The individual amount assigned to each worker is approximately €45,000 and retiring members could have got an enhanced lump sum of €25,000. The trustees have deliberated and got stipends for themselves beyond the scheme's time. They have turned the money into cash, which means that the scheme is losing money, and they are getting professional advice paid for from the scheme - pensioners' money - on how to indemnify themselves. The pot is getting smaller and the workers are losing out, but there is no vehicle for them to have a say over what is being done with their money. Is there anything that we can do to deal with this issue? I do not expect the Minister to know about the situation, but this is true.
I am not sure, to be honest. I am not familiar with that scheme. If the Deputy wants, I can set up something between her and my officials to tease the issue out and see if anything can be done.
The fundamental job of trustees is to look after the interests of the people who are the fund's beneficiaries. Generally, but not always, the trustees are selected from among those people. One would expect there to be representatives of the pensioners, deferred members and the employer among the trustees. Exactly why they are not looking after the interests of the people whom they are supposed to be looking after I cannot say, unfortunately.
One would expect that. Some of them are retired members of trade unions who are earning pensions of approximately €100,000 per year. The workers have not had a say in reselecting them since the scheme was established. The wind-up is being delayed because the trustees are seeking an indemnification against being sued. They are getting professional advice from the likes of the fund's administrator, Mercer. They are getting stipends of up to €40,000 per year for each of the schemes in which they are involved. They only meet a couple of times per year. They are feeding off a fund that is being turned into cash while the members who contributed to it effectively have no recourse to address the trustees' lack of action in this situation despite the fact that the trustees publicly stated that they would wind up the scheme. It is like legitimised theft in some ways. Every delay is making these pensioners poorer.
Will the Minister's officials sit down with us? I do not know what clout they have, but surely someone can say that this is not on or make a legal challenge. What is happening is not right. There must be some way to deal with it.
I do not want to comment on any individual scheme without knowing anything about it, but the members may have recourse, if not through the Pensions Authority, then through the courts. I will not pretend to be an expert in this area. It is a complicated one and I am only getting my head around the legislation, but I will ask one of my officials who understands this area well to make contact with the Deputy in order to determine whether something can be done to assist in this case.
That would be fine.
10. Deputy Joan Collins asked the Minister for Social Protection his plans to reinstate the monthly telephone allowance of €9.50; and his plans to increase the State pension by €25 over a full term of office or by €5 per year. [28786/16]
I tabled this question because older people were particularly badly affected during the recession by the cuts to all parts of their income. They had to deal with the household charge, property tax and the universal social charge, which has now been eased to some degree. They experienced increased motor tax rates and driver licence fees. Medical card entitlements, home-care packages and the fuel allowance were reduced, while the telephone allowance was abolished. These changes were introduced during the recession and it is now time for a reversal. People were hit in their pockets and we should look at reversing all of the cuts to which I refer, starting with the restoration of the telephone allowance and the introduction of Fianna Fáil's €25 pension increase.
The overall concern in recent years has been to protect the value of weekly social welfare rates. Expenditure on pensions, at approximately €7 billion, is the largest block of expenditure in my Department's Estimate for 2016, representing approximately 35% of overall expenditure. Due to demographic changes, my Department’s spending on older people is increasing year on year. Maintaining the rate of the State pension and other payments is critical in protecting people from poverty.
The decision to discontinue the telephone allowance was estimated to provide annual savings of €48 million. These savings meant that my Department was able to retain the other valuable elements of the household benefits package such as the electricity and gas allowance and the television licence. Budget 2016 included the first increase in the weekly rates of payment since 2009. The increase in question led to the maximum personal rates of State pensions rising by €3 per week and, as a result of it, more than 676,500 pensioners and their dependants are benefiting this year.
Looking ahead, the appropriate level of the State pension is all about adequacy and affordability. I am confident that, given the right policies, our economy will continue to grow on a sustainable basis. The programme for Government commits to increasing the rate of the State pension above the rate of inflation. No commitment has been given about a telephone allowance. The appropriate level of social welfare supports will be considered by Government in a budgetary context in the coming days, with due regard to available resources.
The Minister was correct when he spoke earlier. The right course is to cut the austerity for very vulnerable people, like lone parents and the elderly. In that time the wealthy got more wealthy and social welfare payments were attacked. Now they have been pared to the bone. People are demanding extra money in their pockets. The Minister argues that there is a recovery going on but people who are really hurt have yet to see it. The telephone allowance was very important for the elderly, particularly as during the recession so many of their children had to leave the country to work elsewhere. The Minister knows people need landlines in order to use Skype, etc., so the abolition of the telephone allowance made it very difficult for people to keep in contact with their children and grandchildren. This measure should be looked at again so we can give something back to the elderly in this country in the next budget.
I met groups that represent the elderly in the course of my work and I am sure the Deputy, as a politician, meets them in the course of hers. When I ask them what they would most like to see done for them in the budget, many bring up issues of services like home-care packages. When they talk about these kinds of more budgetary measures, we hear of three issues. They are the €5 increase in the pension, the restoration of the telephone allowance and reduction or elimination of prescription charges. I would love to achieve all those but that will not be possible in this budget. I hope we will be able to make a start on it in this budget and achieve the other measures in subsequent budgets but, obviously, we must balance the books.
There seems to be certainty in terms of the fact that pensioners are going to get an increase. An increase of €5 per week has been mentioned. At the weekend, I read reports that this might be the case and I believe the Minister made a statement that it could be €4 or €3. After pensioners got a €3 per week increase last year, which they felt was derisory in light of the fact that they had to put up with all the austerity, will the Minister commit to a €5 increase?
I have never given a figure and I cannot because it is not yet agreed. The budget will be announced next-----
Deputy O'Dea has not agreed it yet.
Deputy O'Dea has the budget in front of him.
It will be announced next Tuesday by the Ministers for Finance and Public Expenditure and Reform, Deputies Donohoe and Noonan. Fine Gael committed to a €5 per week increase in the pension and, as part of our confidence and supply arrangement with Fianna Fáil, provision will be made for an increase in the pension. No decision has been made on the exact amount. What I have said today is significant as I mean it. We cannot have a position in the budget whereby pensioners get an increase in the weekly payment but the disabled, carers, the blind, widows under 66, lone parents and people on invalidity pension get nothing. Taking them as a group, they are worse off than pensioners. I am trying to square that circle and make sure there is something in it for those very vulnerable people.
11. Deputy Paul Murphy asked the Minister for Social Protection in view of the record high level of rent in the private rented sector if his Department will increase the rent limits for rent supplement; and if he will make a statement on the matter. [28790/16]
Rents continue to rocket. Rent supplement levels have been increased - although not sufficiently because they have already been overtaken by rising rents. In view of the latter and the fact that people's inability to access properties within rent supplement limits is a driving factor in the rise in homelessness, does the Minister agree that those limits should be increased?
Supports relating to housing are a key priority for this Government, as evidenced by the early implementation of our commitment to introduce increased rent limits under the rent supplement and housing assistance payment, HAP, schemes. The increased limits were introduced from 1 July 2016. The rent supplement scheme assists 50,700 tenants at a cost of €267 million this year. The review process undertaken represented a realignment of the maximum rent limits with agreed rents, with rents generally benchmarked against the 35th percentile of those registered with the Residential Tenancies Board. The review's methodology is evidence-based and reflects the pressures on rental properties in each location. Rents were increased by a weighted average increase of approximately 30% in the Dublin area.
In recognition of the ongoing difficulties in the rental market, my Department continues to implement a targeted, flexible, case-by-case approach where rents may exceed the maximum limits. Approximately 10,000 people have been given rent supplement above the maximum limit. The protocol arrangement in place with Threshold continues to operate in the areas where supply issues are particularly bad, covering Dublin, Cork, Meath, Kildare, Wicklow and Galway city. The number of requests for increased rental payments for rent supplement customers has reduced dramatically following the introduction of the new limits in July. These measures along with the reforms to the private rental sector, notably that rent reviews can only take place if it has been two years or more since the previous review, will provide increased certainty and security for tenants and landlords. I am continuing to keep the matter of rent limits under close review.
The evidence is there and it is clear that the maximum rent limits do not enable people to rent homes. This comes to me mainly from people who are made homeless or threatened with homelessness for whatever reason in their current accommodation. When they are encouraged to seek other accommodation within the rent supplement limits or slightly above them so they can look for a variation, people invariably say they cannot find anywhere.
This morning I looked on a website for properties suitable for a couple in Dublin - not Fingal - with €900 as the maximum rent limit. There is nowhere appropriate. For a couple with one child the maximum limit is €1,250 per month and there are zero places available. For a couple with two children needing a two-bedroom place with €1,275 as the limit, there is one place available. For a couple with three children and a rent limit of €1,300, no places are available. As suitable properties are unavailable, does the Minister not see that the rent supplement limits must be increased?
As has been the case for quite some time, if people cannot find a place, they may apply for a top-up to the rent supplement. Until July, when the rent supplement was increased, that was happening on an almost daily basis and 10,000 people were in receipt of top-ups. The number requesting top-ups has since fallen dramatically, indicating that the real problem is a lack of supply. That is the underlying problem, so continuing to increase the rent supplement will drive up rents even further.
What actually needs to be dealt with is the issue of supply. For seven years no social housing was built in this country because the Government was broke and the private sector did not build any houses either because the banks and construction industry were broke. We now have a plan being driven by the Minister for Housing, Planning, Community and Local Government, Deputy Coveney, to turn that around, to build lots of social housing and to get the private sector building again. That is where the solution lies.
The fundamental solution is to increase the supply. There is no question about that. However, I do not think the Government has a solution in terms of supply. The previous Government built less social housing than any Government in the history of the State and this Government is committed to a market-led solution. What we need is massive public building of social housing using the resources of NAMA and so on.
While we wait for these houses to come on stream, and it is questionable whether they ever will, we have a crisis right now because of the incredible price of rent. While the fact that people can access a top-up is an improvement on the previous situation, it is not ideal that people must make a case for themselves to an official, who then decides yes or no. People should have a right to rent supplement or whatever is needed in order that they can have access to a home.
Statistics were released recently which showed that in Dublin 24, for example, if a person on the minimum wage were to spend 30% of his or her income on rent, which is the recommended percentage, he or she would have to work 84 hours per week. The prices are completely out of control and people simply cannot access housing. Increasing the rent supplement limits now would make a real difference to people.
Actually, I am not sure that it would. I was quite sceptical as to whether increasing the rent supplement limits would make a difference. However, we said that if we were going to do it, we would do it properly and that is why the increases were so big. They averaged 15% but were 30% in some places and even more than that for some categories of family. In many cases, the limits are at or even above what they were the last time that rents peaked. I am not sure that just putting them up again would work because it will not make one additional house or apartment available. It will just change the dynamic among the people who are competing to get the one house or apartment that is available. That is why the solution has to be based on increasing supply and making better use of properties that are vacant or not used at all. In addition to that, we must move towards the housing assistance payment, HAP, scheme which allows for much higher payments than is the case with the rent supplement scheme. HAP starts in Dublin next year.
12. Deputy Willie O'Dea asked the Minister for Social Protection the way in which he plans to address the issue of fuel poverty; and if he will make a statement on the matter. [28747/16]
The Minister said earlier in response to Deputy Joan Collins that he had met a number of organisations representing the elderly in the run-up to the budget. They will no doubt have made him aware that fuel poverty has become a huge issue, particularly among the elderly. What plan does the Minister have for his Department to deal with this issue? I know that other Departments are involved but I am asking this question specifically from the point of view of income because income is a fundamental determinant.
The risk of fuel poverty is influenced by a combination of fuel prices, weather, income and the heat efficiency of housing. My Department will continue to ensure those on low incomes and those who are more vulnerable to energy poverty are supported through the fuel allowance and the household benefits package. The fuel allowance is a payment of €22.50 per week for 26 weeks from October to April to more than 380,000 low-income households at an estimated cost of €224 million in 2016. This payment assists these households with the higher energy costs that arise in that period. It is a contribution towards the energy costs of a household and is not intended to meet those costs in full. Only one allowance is paid per household.
My Department also pays an electricity or gas allowance as part of the household benefits package to more than 420,000 customers at an estimated cost of €228 million in 2016. Under the supplementary welfare allowance scheme, a special heating supplement may be paid to assist people in certain circumstances who have special heating needs due to ill health or infirmity. Exceptional needs payments may also be made to help meet an essential one-off cost which a person is unable to meet from his or her own resources.
The Government’s affordable energy strategy indicated that the best measure to address energy poverty is to improve the thermal efficiency of homes. The better energy warmer homes scheme, administered by the Sustainable Energy Authority of Ireland, funds energy efficiency improvements in the homes of the elderly and vulnerable, making their homes more comfortable, healthier and more cost-effective to heat.
We have all had representations from organisations representing the elderly. They have conducted surveys and have come across people who do not light a fire until the afternoon and who go to bed early in the winter to save fuel. Other people resort to taking public transport or taking shelter in public libraries and other public buildings because they simply cannot afford to heat their homes properly for a sufficient period of time to enable them to live comfortably in their homes.
Growing older increasingly seems to mean growing colder. The Minister mentioned that there are other Departments involved in addressing this issue and I recognise that and while I acknowledge that energy efficiency is important, ESRI research into fuel poverty, conducted in 2015, found that the problem of fuel poverty is primarily one of inadequate resources rather than being mainly a housing issue. The Minister has indicated that his Department will deal with this through the fuel allowance and the household benefits package, both of which have been cut although, admittedly, there was a partial restoration of the fuel allowance, which I welcome. Can we look forward to improvements in those areas in the immediate future, for example, next week?
Unfortunately, the budget is not agreed yet so I cannot tell the Deputy whether there will be something in it on the fuel allowance. It is worth pointing out that, in the budget for this year, the fuel allowance was increased from €20 to €22.50 per week, an increase of more than 10%. Exceptional needs payments can be paid in special circumstances. It is also worth pointing out that fuel costs are falling at a significant rate. According to the CSO's latest figures, the cost of electricity has gone down by 6.1% in the last 12 months, gas by 2.4% and home heating oil by 13.5%. The cost of fuel is going down this year and the fuel allowance has gone up. Obviously, one would hope that we will continue in the same direction next year, but I cannot guarantee that at this stage.
While I welcome last year's increase in the fuel allowance, it was only a partial reversal of a previous cut. I recognise that fuel prices are dropping, but research published recently in the Journal of Environmental Health relating to the island of Ireland, that is, the Thirty-two Counties, concluded that Ireland has the highest rate of excess winter mortality in Europe, with an estimated 2,800 excess deaths each winter. Fuel poverty is a crucial factor in this phenomenon. I am referring to that research to reinforce the point that there is a real problem here. Financial assistance to those who cannot afford the cost of fuel is a key factor in combating fuel poverty, and I want to impress that point on the Minister.
The Deputy's point is well made. Even aside from the fact that the fuel allowance can help ease fuel poverty, it is a very good payment in the sense that it is means-tested and very targeted. I am not sure, however, that I will be able to match all of Deputy O'Dea's expectations in this particular budget, but if he keeps me here for long enough, we will get there.
13. Deputy Richard Boyd Barrett asked the Minister for Social Protection if he will consider ensuring those on carer's allowance are afforded the full benefits of a PRSI stamp in order that in the event of the person they care for no longer needing care, they would be eligible for jobseeker's benefit and the other benefits afforded to those working full-time who lose their jobs; and if he will make a statement on the matter. [28753/16]
This is a straightforward, fair and reasonable request that carers, who do an enormous service to this State by caring for the disabled, sick, old and infirm, would be acknowledged and afforded the full benefit of a PRSI contribution. This would mean that when they finish caring, they would be entitled to non-means-tested benefits, which would be fair and would acknowledge the hugely important work they do for the State, work for which the State would have to pay a hell of a lot if carers did not do it.
The social insurance system recognises the contribution of the recipients of carer's allowance through the system of credited contributions and also through the homemaker's scheme.
Credited contributions or credits are awarded to recipients of carer's allowance who have an underlying entitlement to credits. Recipients of this payment qualify for credits if they have had at least one paid contribution in the previous two years or have had credited contributions in that period. Credits are also awarded to workers who take unpaid carer's leave from work.
Credits protect social insurance entitlements by bridging gaps in employees' social insurance records when they are not in a position to pay PRSI, for example, during periods spent caring. In combination with paid PRSI contributions, credits can help employees to qualify for short-term schemes such as jobseeker's benefit and enhance the level of benefit for long-term schemes. Carers who cease caring can apply for jobseeker’s benefit, but to qualify they need to satisfy the contribution and other conditions for that scheme.
Former carers can also access means-tested payments such as jobseeker's allowance, subject to satisfying qualifying criteria.
All carers, including those who do not qualify for a payment or for credits, may qualify for the homemaker's scheme, which is designed to help homemakers and carers qualify for the State contributory pension.
My priority is to make progress on the commitment in the programme for Government regarding the level of support for carers, subject to the resources available.
Although I am not doing so, it would be very reasonable to ask for carers to be paid the minimum wage, at least, for what they do, or alternatively to be paid an amount equivalent to how much it would cost the State to provide home care packages if carers were not doing this full-time caring job. The State is getting this service from carers for €204 a week, or approximately €5 an hour. Rather than asking for carers to be paid the minimum wage, we are calling for all carers to be afforded the full PRSI credit so that they can avail of benefits like jobseeker's benefit or the contributory pension. This is the least we should do for them in light of the very cheap service they perform for the State. Can the Minister respond to that reasonable proposal?
I think the Deputy is asking whether it is possible for someone who has been a carer to receive a non-means-tested benefit for a period after he or she finishes caring, as if he or she had been paying PRSI.
That is exactly it.
He is referring to jobseeker's benefit or a similar benefit.
At present, when the person for whom a carer has been caring dies, the carer continues to receive carer's allowance for 12 weeks. It is a different way of doing the same thing. This does not happen if the person for whom the carer is caring goes into long-term care, however. In such circumstances, the allowance is stopped and the carer does not get the allowance for three months while he or she reorganises his or her affairs. Family Carers Ireland has made a strong case to me that the 12-week arrangements should apply when the person being cared for goes into long-term care. It is something I am considering in the context of the budget.
We will move on to the next question.
On the wider-----
Does the Deputy want to ask a further question?
Yes. I take the Minister's point. I am glad to hear he is looking at the issue.
The Deputy has another question coming up.
I know. Is the Minister saying he is considering giving carers a full entitlement to the credits that would allow them to get non-means-tested payments when they cease caring? Is he going to move towards that?
I would like to explain a couple of aspects of this matter. When cash contributions come in through the PRSI system, the social insurance fund pays for non-means-tested benefits like the contributory pension and jobseeker's benefit. In order to have a benefit at one end, one has to be paying in at the other end. The only fair and just way to do what the Deputy is suggesting, while ensuring it is acceptable from an actuarial point of view, would be to require carers to pay PRSI contributions. I am not sure that is the right way to do it. In my mind, the right way to do it would be to allow people to continue to draw down carer's allowance for a number of months after they have stopped caring. That is a much simpler way of doing the same thing.
The State could pay the contributions for them in acknowledgement of their service.
Yes, but if that were done-----
We are running out of time.
-----they would be the only workers who are not paying PRSI while their employers pay PRSI for them.
They are the only workers on €5 an hour.
Of course, the State is not the employer of carers. It would be a very expensive and complicated way of doing something that can be done much more simply by allowing people to continue to get carer's allowance for a few months after they finish caring.
14. Deputy Richard Boyd Barrett asked the Minister for Social Protection his views on the findings of the Michelle Millar report; and if he will make a statement on the matter. [28754/16]
I ask Deputy Boyd Barrett to be quick. I will give him 15 seconds.
The Chair is very amusing.
It is not meant to be amusing. I am bringing it to the Deputy's attention that time is almost up.
The Michelle Millar report is a damning indictment of the cuts that were imposed on lone parents in the name of so-called labour activation. It clearly indicts the cuts imposed by Deputy Burton as having increased deprivation levels by reducing the incomes of lone parents who go out to work. Will the Minister act on the Millar report, which was commissioned by his Department?
I acknowledge the time and effort spent by Dr. Millar and her team in completing this study. My Department values the contribution social policy research makes in assisting the Department by informing policy across its broad remit.
The report does not purport to be an analysis of the lone parent reforms. Based on the study’s terms of reference, my Department expected that it would provide detail on the design of specific education, training and employment programmes that work for lone parents, including evidence of outcomes. That is why the report is called Lone Parents and Activation, What Works and Why. It is disappointing, therefore, that it does not supply the additional new detailed material that is required to inform the future design of these activation interventions for lone parents. The report does contain useful and worthwhile information based on national and international experiences that will be considered by my Department.
The overall direction remains the activation of lone parents. I believe the report supports that principle too. Data shows that being at work reduces consistent poverty among lone parent families. Those at work have consistent poverty rates of 9.6%, compared to 35.5% for those not at work. Therefore, the key to ensuring lone parents are lifted out of poverty is to aim to support them into employment.
The report highlights the critical nature of the case officer role in my Department and the importance of a package of supports in areas like pre-employment, employment, finance and child care.
While the qualitative interviews in the report will add to our knowledge, the sample size is small and the period of implementation of the reforms is short. There have already been adjustments since they were introduced. It is too soon to draw definitive conclusions about the outcome of these reforms.
As I said at the start of Question Time, initial indicative data from the quarterly national household survey show that there was a significant increase in the percentage of lone parents in employment in the year to the end of June 2016. This increase relates to all lone parents in the State and reflects the increase in economic and employment growth generally. The magnitude of the increase in lone parents in employment, many of whom would have been affected by these reforms in July 2015, is clearly significant and cannot be dismissed. I refer to the fact that the percentage of people in work has increased at a faster rate among lone parents than it has among the general population.
We are out of time.
Do I get to respond?
No. We squeezed in the final question. We have gone over time. I allowed the Deputy in for a final question. I was trying to encourage him to be brief earlier because I could see where we were heading. I am sorry about that, but we cannot go on all day.
