The dependent adult and people on reduced rate payments will receive the proportionate increases, while younger jobseekers aged 26 and under on their reduced rates will get the €5 increase, again from 26 March.
Recently in the Dáil, when speaking about the need to update, revamp and streamline the current complex eligibility system for old-age pension qualification, which is, as I said at that time, riddled with anomalies, clearly not fit for purpose and discriminatory at its roots, I also referred to what I termed a bugbear, or aspect of the pension system I find very irritating. It feeds into other social welfare entitlements and payments. I refer to the clearly outmoded, outdated and old-fashioned concept of the qualified adult dependant, who is usually the wife or partner because the system at its inception was clearly based on the male breadwinner model. One big innovation or positive change the Minister could introduce would be to change this dependency concept. I know she is very open to innovation and I applaud, accept and acknowledge that. She could leave a significant mark in the Department by doing this.
I recall when the value of the adult dependant pension was about 65% or 70%, so a wife - we will use that example - who was entitled to a pension of €200 got €140 or thereabouts. I think it has now increased to 90% of the value of the recipient's pension, and this is welcome. However, equality is an important objective in practice, not just in theory, and it is generally wives or women partners who are being treated as appendages to their husbands or partners instead of the couple being treated equally as a unit.
If the husband, based on his contributions - or not, if in receipt of a non-contributory old age pension - receives €220, the wife or partner should be likewise treated and get the same amount. As I have said before in this House, it is only in very recent times that the wife or partner, as a qualified adult dependant, has been paid the reduced rate of pension in her own name. Previously, it was part and parcel of the husband's pension payment, and sometimes - let us be clear - the qualifying adult dependant never saw a red cent of that money, which was due to her. Let us see some real equality here and eliminate this concept of being classified as dependent. That would be very important, from my perspective.
While on this theme of equality, reduced payments to under 26s are a remnant of the dark recess of the undoubtedly vicious economic recession which we encountered from 2008 onwards. The current system is no longer sustainable in the longer term. As the economy recovers, people in similar circumstances - in other words, those who are unemployed and actively seeking work - should not receive a lower payment just because they are under the age of 26. All people should receive the same payment of €198 which will be payable in 2018. This is another anomaly introduced for economic and budgetary reasons which should now be redressed and reversed as quickly as possible.
It will be no surprise to anyone who has served with me in this House, particularly on social welfare committees, one of which I was glad to chair for five years, to know that my special interest group in the welfare system has always been the carers of Ireland. I wrote a report on them with 15 recommendations, eight of which were implemented. We did not have any consultants working on that report. That is part of the failure here: people want consultants for everything.
Carers deserve our deepest and sincerest level of gratitude for their unstinting and devoted work and Herculean efforts 24 hours each day, seven days a week, 52 weeks of the year. These are the real unsung heroes of Ireland. If a proper honours list is ever introduced in this country or inaugurated by the Government in conjunction with the President, each carer should be honoured every year. We should forget about the tax exiles and the flash Harrys, who might turn their noses up if we had such an honours list. Carers are the real people. More than 300,000 of them are scattered across Ireland, saving the country in excess of €6 billion each year. If they downed tools today, the health system, the accident and emergency departments, the acute hospital beds and everything else associated with health would grind to a halt and collapse. Their work is invaluable and their contribution absolutely incalculable.
I intend to draft an updated carers' needs assessment Bill in order to try to put their requirements and the necessary assessments on a statutory footing. If we have more money or resources to distribute, they should always be first in line. I have spent 25 years advocating for their cause and will continue to do so for as long as I am in this House because they deserve not just our attention, not just lip service, but real payments to acknowledge their contribution.
The one-parent family payment is likewise extremely important as it is a means-tested payment made to a man or woman who is caring for a child or children without the support of a partner. The payment contains an earnings disregard. I welcome the positive changes to the scheme that the Minister announced in the budget. In July 2015 the age limit of children in respect of eligibility for the one-parent family payment was reduced to seven years of age for most claimants. When the recipient of a one-parent family payment no longer qualified for the payment due to the youngest child being aged seven, the Department established the jobseeker's transitional payment. This was paid to people not cohabiting whose youngest child was aged between seven and 13, I think. It aims to support those parenting alone to enter the workforce while acknowledging that they care for young children.
While all this was bright and rosy and dandy, as they say down in Westmeath, in theory it was not so bright and rosy, in particular due to the huge deficit in geographically dispersed child care facilities and local jobs or employment opportunities. These are vital in the absence of a transport network which, again, was in huge deficit across rural Ireland.
I read the Indecon report published in early October by the Minister's Department. It found that the reforms to the one-parent family payment were successful in increasing employment and reducing welfare dependency. Nevertheless, it indicated, despite this finding, and while accepting it was too early to examine the overall long-term impacts, a potential serious concern that many of those who lost one-parent family payment remained unemployed or in low-paid or part-time employments, echoing my own and many of my colleagues' fears when the reforms were first introduced.
It is noted in the Indecon report:
The objective of the policy changes which were designed to increase employment and reduce long-term social welfare dependency was a valid rationale for the policy changes. The findings in the report support the rationale and continued relevance of the policy changes [...] However, unless accompanied by further increases in employment the objective of reducing poverty will not be met for many individuals. Lone parents remain among the most vulnerable groups and demonstrate a high level of risk of poverty and social deprivation.
That finding needs to be taken on board, as do similar findings in the UNESCO report, Lone Parents and Activation, What Works and Why. The latter report notes that following changes in one-parent family policy, lone parents in part-time employment prior to the changes had experienced a reduction in income as a result. This change encouraged welfare dependency as lone parents found taking up work could actually reduce their income. It is clear that a lone parent's capacity for work cannot be equated with that of a parent in a two-parent family. A package of support for lone parents should include pre-employment supports, employment supports, financial supports and child care supports. As we all know, child care costs in Ireland are among the highest in the OECD. In this context, I welcome the increase in the earnings disregard from €110 to €130 per week from 29 March 2008.
Family income supplement, FIS, is being renamed. I was a little confused in this regard because there seems to be something of a subsuming taking place rather than the introduction of new schemes. The working family payment that was promised by the Taoiseach when he was Minister for Social Protection proposed a payment to families whose weekly income was less than a set amount and which would vary depending on family size. The payment would be calculated at 60% of the shortfall between the net weekly family payment and the applicable FIS threshold. I note that the threshold in question is to be increased by €10 for a family of one, two and three children. Of course, one of the major issues with FIS over the years has been the lower than expected take-up, in line with most means-tested social welfare schemes. As far as I can work out, the take-up is only 35%, or 60,000 families. An additional problem is that the scheme can be used by exploitative employers to allow them to pay less than they should because the State is taking up the slack. We will have to keep an eye on that.
I welcome the provision to continue the back to work family dividend scheme beyond 31 March 2018, with no closing date given. This is an important political instrument to encourage families to move from social welfare into work by offering financial support to people with qualified adult children who take up employment or self-employment and, as a result, cease claiming a jobseeker's payment or one-parent family payment. That support lasts for up to two years if the recipient remains in employment. It is not taxable and is based on the standard increase for a qualified child, which is now rising to €31.80, up to a maximum of four children. Will the Minister indicate how many applicants have taken up this scheme? Under the current payment of €29.80, a family of four would be eligible for an annual payment of €9,298.
The Bill proposes to make changes in the weekly rate for maternity, adoptive and paternity benefit and also provides for extended periods of entitlement to maternity leave and maternity benefit in the event of a premature birth. It also provides for an extension of the period after the death of a mother having given birth for the transfer of maternity benefit to the father. These are all welcome and progressive changes. The Maternity Protection Act 1994, as amended by the Maternity Protection (Amendment) Act 2004, made provision for 26 weeks of paid leave and 16 weeks of unpaid leave for mothers. The legislation also affords a father entitlement to the remainder of the maternity leave where the mother dies giving birth or while on maternity leave.
The Paternity Leave and Benefit Act 2016 introduced paternity benefit and statutory paternity leave of two weeks. It is payable to employed and self-employed fathers who are covered by PRSI and in respect of every child born or adopted after 1 September 2016. Recipients are allowed to commence paternity leave at any time within the first six months following the birth of the child or adoption placement. It is good that we have made progress in this area. I understand Austria, for example, still does not offer any paternity leave or benefit to fathers. The Bill increases the weekly rate of paternity benefit from €235 to €240 in line with the corresponding increase in maternity and adoptive benefit. Is there any estimate of how many applicants will benefit from this increase in paternity benefit provision? I appreciate it may be difficult to arrive at an accurate figure given the six-month leeway for fathers taking leave.
Subsection 14(1)(a) of the Bill provides for a number of fundamental and serious amendments to section 47 of the principal Act. One of the effects will be to entitle the father of a child to receipt of that maternity benefit in the event of the mother's death following the birth of the child or following the due date and before expiry of the maternity benefit due to the mother had she not died. It also amends the requirements of section 48 of the principal Act, on contributions and receipt of maternity benefit, and section 50(b), which deals with failure to attend medical examinations, to specify that they are not applicable to fathers.
Section 15(1) of the principal Act is amended by section 14(2) of this Bill such that, from 1 October 2017, the entitlement to extended maternity benefit in the case of premature birth will be applicable where confinement occurs up to two weeks before the end of the expected week of confinement. The section amends various provisions of the Maternity Act 1994, in parallel with the amendments made in section 14.
An issue we have discussed extensively in this House is the increase in the qualifying age for the State pension. At this time, a person who started work at 18 years of age and is now 62 and whose employment contract ends at age 65 will not be eligible for a State pension until he or she is 67. That lack of provision is forcing people out of employment into poverty. The increase in eligibility age from 66 to 67 will come into effect in January 2021 but there is no provision for the people affected in the social protection system. Fortunately, we are now in a better economic state than we were when these changes were introduced in 2011, with the continued reduction in unemployment bringing in additional moneys for the Exchequer. In that context, any further increases in the State pension age must be stalled until we are in a position to deal with this anomaly in the system. Deputy Brady has introduced a Bill to deal with this issue and I urge the Minister to make any necessary amendments and advance those proposals. In the meantime, we should not race ahead of ourselves and other members of the EU by further increasing the age of qualification for the State pension. Above all, we must put in place measures to compensate workers who retire before reaching the qualifying age.
The Minister, being well aware of the needs of the self-employed, is committed to the introduction of a universal second-tier pension. The quicker the automatic enrolment scheme is put in place the better. Many business organisations were against bringing forward these changes in the past. They might have had a point during the recession but there is no reason to delay them now.
There has been extensive discussion in this House regarding the 2012 changes in the PRSI qualification bands and the implications of those changes for female workers in particular. We should not forget, however, that thousands of men have also been impacted. In fact, 38% of the affected parties are male. The changes are significant in terms of the prospects of the PRSI contributors concerned, both male and female, and there is an urgent need to address this issue. I understand the Minister is in discussions with her officials with a view to putting in place a system for ensuring those pensioners have their adverse situation rectified as quickly as possible. I hope that can be done. At the same time, I appreciate that she must be careful not to create further anomalies in the system. It is important, however, to show good faith in this regard and to act to remedy it.
It has to be done as a stand-alone issue. If it goes with something else it becomes integrated and that is where problems can arise. People are seeking commitments to make sure it is done.
I also welcome the improvements in the various benefits available to self-employed people. The guts of 400,000 people across the State are self-employed. During the recession they sometimes acted as the Lone Ranger, standing in the bearna or in the gap. They kept things going. Very often they were the last people who got paid as they tried to keep workers going. Many of them went to the wall and the social welfare system was highly antagonistic towards them and not nice at all, asking them where was the money they had earned the previous year. This is like asking where is the snow that was here 12 months ago. Thankfully, that changed and the whole attitude has changed towards self-employed people. We must recognise the role they have played in ensuring the economy's revival. They were the backbone in ensuring there was not a total collapse. I recognise the work, the entrepreneurship and the innovation of those people. I am glad they will begin to get something back for their contributions in respect of sick benefits and other benefits. The Labour Party will support the Bill going forward to Committee Stage as quickly as possible. We may put forward amendments to address some of the issues I have raised. Overall, however, it is important to get this Bill implemented. I am glad that despite the febrile atmosphere earlier, the Dáil has not collapsed and we can pass this Bill as quickly as possible to ensure people will get their due entitlements and increases in social welfare benefits as quickly as possible - notwithstanding the fact that they are small amounts.