This Bill is designed to give effect to the increases in the rates of social welfare payments announced in the budget and other changes in social welfare schemes. As usual, the Bill contains a number of rather technical amendments to existing legislation which I will endeavour to clarify for Senators.
The Government are committed to maintaining the value of social welfare payments by increasing them regularly and bringing about, whenever possible, real improvements in the living standards of social welfare recipients.
Figures recently published indicate that the increase in the consumer price index is running at about 10.8 per cent but it was projected in the budget statement to fall to 5 per cent towards the end of the year. On this basis the 12 per cent increase in rates of short-term payments as a whole should maintain the position of recipients and provide an increase in their living standards. The increase in the case of long-term payments is 16 per cent as those on long-term payments, such as retirement pensioners and old age pensioners, are generally regarded as requiring special attention in the social welfare context and the desirability of higher increases in their case will be readily conceded.
All weekly personal rates of non-contributory old age pension are being increased, the increase at the maximum rate from £13.60 to £15.80 for persons aged under 80 years and from £14.65 to £17.00 for persons aged 80 years or over. Provision is also made in the Bill to ease an anomaly caused by the application in recent years of uniform percentage increases to the reduced rates of pension payable where weekly means exceed £6. This has resulted in a scale of means and rates of pension under which weekly pensions are reduced by £1.40 for every increase of £1 in means. As a step towards achieving a scale where pensions will not be reduced by more than £1 a week for each £1 increase in means, the Bill provides that the stages between rates will be reduced to £1.30. As a result, there will be two additional rates of pension in the table of rates, and reduced rates of pension will be payable to pensioners without qualified children up to a means limit of £17. For a pensioner with qualified children, of course, the means limit will be greater than £17.
The maximum rate of payment in respect of an adult dependant under pensionable age is being increased to £7.85, the allowance payable in respect of a prescribed relative giving full-time care and attention to an incapacitated pensioner is being increased to £8.80 and the addition to pension for a pensioner living alone will become £1.30.
The additions to pension for qualified children are being raised to £4.25 a week for each of the first two children and to £3.20 a week for each other child.
The new scale of weekly means and rates of pension is set out in Table A in section 2 of the Bill.
Section 3 of the Bill provides for the increases in the rates of unemployment assistance. The increase in the personal weekly rate of assistance will bring the maximum to £13.15 in urban areas and to £12.70 in rural areas. The rates for adult dependants are being increased to £9.60 and £9.35 respectively and the rates for dependent children to £4.10 for each of the first two and £3.10 for others.
The rates of unemployment assistance now payable in the case of smallholders whose means are assessed notionally by reference to rateable land valuation are, if their valuations are over £10, lower than the rates which are payable to applicants generally. These lower rates result from the fact that rate increases in previous years were not applied in the case of those smallholders. On this occasion, however, the 12 per cent increase applies to all rates of unemployment assistance. Section 3 includes the three new schedules of rates which will now apply.
Section 4 of the Bill provides for a change in the notional method of assessing means for unemployment assistance purposes in the case of smallholders residing in specified areas of the country.
At present, the multipliers used to assess the annual income of those smallholders are £20 per £1 land valuation where the valuation is £15 or less, and £30 per £1 valuation where the valuation is over £15 and up to £20. The £20 multiplier has not been changed since its introduction in 1966 and the £30 multiplier has been unchanged since 1976. Section 4 provides for increases in the multipliers from the beginning of April. The increase for those with valuations of £10 or under will be from £20 to £30, for those with valuations over £10 and up to £15, from £20 to £50 and for those with valuations over £15 from £30 to £60 per £1 land valuation.
Section 5 of the Bill will give any smallholder covered by these provisions, who feels it would be to his advantage, the option of the factual assessment of means which applies generally to applicants for unemployment assistance.
Section 6 of the Bill provides for increases in non-contributory widow's pensions and the social assistance allowances for deserted wives, unmarried mothers and prisoners' wives. The maximum weekly personal rate is increased to £15.80 and the amount for each qualified child to £5.20. As in the case of non-contributory old age pension, provision is being made for uniform reductions of £1.30 in pension for each £1 increase in means. Section 9 provides for increases in non-contributory orphans' pensions, the new maximum rate being £10.25 per week.
Section 10 provides for increases in single woman's allowance, the new maximum rate being £13.65.
Under section 11 the rates of supplementary welfare allowances are being increased to maintain the parity between the rate of the allowance and the rural rate of unemployment assistance.
Increases in children's allowances are provided in section 19 of the Bill. The monthly allowance for a one-child family is increased to £3.50, for a two-child family to £9, for a three-child family to £14.50 and the allowance for each subsequent child is increased to £5.50. The new rates will come into effect from April.
One reason for the substantial increase in children's allowances on this occasion is to cushion the effect on the lower-paid and those with large families of the recent reductions in food subsidies. Families below the tax threshold will benefit in full from the increases now provided. As an interim measure, compensation for the reduction in subsidies was already given to persons in receipt of assistance payments by an adjustment in the value of the EEC butter scheme vouchers.
The increased rates of contributory benefits and pensions under the social insurance system are set out in section 20 of the Bill. Disability and unemployment benefits are increased to £16.05 for a single person and to £26.50 for a person with an adult dependant. Payments for children with these benefits are being increased to £4.65 for each of the first two children and to £3.80 for each other child. Maternity allowance is also being increased to £16.05.
The personal rate of invalidity pension, which is a long-term payment, is being increased to £16.65 with an addition of £10.85 for an adult dependant.
Contributory old age and retirement pensions for persons under age 80 go up to £18.60 and, for those over 80, to £20. The addition to pension for an adult dependant is being raised to £11.90 where the adult dependant is under pensionable age and to £14.05 where the adult dependant is aged 66 or over.
In the case of widow's contributory pension and deserted wife's benefit, the new personal rate will be £17 for those under age 80 and £18.25 for those aged 80 or over.
The additions to widow's contributory pension and deserted wife's benefit for qualified children are being raised to £5.70 for each child. In the case of other social insurance pensions, the new additions for child dependants will be £4.80 for each of the first two children and £3.95 for each other child.
In line with the improvements in the general social insurance system the Bill provides in sections 25 and 26 for corresponding increases in the rates of benefit payable under the Occupational Injuries Scheme.
In addition to rate increases, the Bill makes provision for a number of other improvements in the social welfare services. Improvements of this nature, while they do not attract the same degree of attention as the general increase in rates of payments, are, nevertheless, well worthwhile because of the benefit or alleviation they bring to individuals or small groups of persons. The first of these relates to equality of treatment for men and women in social welfare schemes. Senators will recall that in 1978, in pursuance of the policy of removing discrimination against women in social welfare, provision was made for the removal of the special conditions for receipt of unemployment assistance by single women and widows. A further major step towards equality of treatment is the provision in section 22 of the Bill extending to 312 days the period for which unemployment benefit may be paid to married women who are now entitled to only 156 days.
Two of the other improvements provided in the Bill relate to the social insurance system. An improvement in the maternity allowance scheme is made in section 23. This allowance is payable at present to a woman for a maximum period of six weeks prior to the expected date of confinement and for six weeks thereafter. However, if the birth of a child occurs prematurely, the allowance may not be paid the full period of 12 weeks. Section 23 provides that from 2 April 1979 the allowance will be paid in all cases for a minimum period of 12 weeks.
The second improvement concerns the position of a deserted wife who becomes widowed while in receipt of deserted wife's benefit. Although the contribution conditions for widow's contributory pension and deserted wife's benefit are the same, the dates on which these conditions must be satisfied are different—the date of desertion in one case and the date of the husband's death in the other. It is possible that a deserted wife, though in receipt of deserted wife's benefit, could fail to qualify for a widow's contributory pension on her husband's death, if his insurance diminished after he deserted her. Section 24 of the Bill provides that such a woman will automatically qualify for widow's (contributory) pension, whether or not the contribution conditions are satisfied in her case.
On the social assistance side, the Bill provides for a considerable number of minor improvements. Section 7 provides for the abolition of the upper age limit for non-contributory widow's pension. The limit is 66 years at present so that a widow at that age is obliged to transfer to non-contributory old age pension. However, this may lead to a reduction in her pension because of the more favourable treatment of income from capital in the case of widow's pension than for old age pension. The position is now being rectified by allowing a widow to continue to retain her widow's non-contributory pension after she reaches 66 years of age.
Sections 13 and 14 will increase to £200 the amount to be disregarded in assessing income from capital for means test purposes. The present amounts which may be disregarded are £25 in the case of old age pensions and £100 in the case of widow's pensions and equivalent allowances.
Section 15 will ensure that any unearned income of a child, such as income from a trust, a portion of which is at present assessed in determining a widow's means, will no longer be so assessed.
Under section 16 the amount of a person's earnings to be disregarded as means where there are qualified children will be increased to a uniform £104 for each child from £39 in the case of an old age pensioner and £78 in the case of a widow. The section also provides for the adoption of a uniform definition of earnings for this purpose.
Section 17 will extend the provision whereby old age and widow pensioners do not suffer an overall reduction of income when certain other pensions to which they are entitled are increased. This provision, which now applies only to pensions payable under statute or by another Government, will in future embrace any occupational pension to which the pensioner is entitled.
Section 18 provides that in assessing means, dwelling houses and farm buildings, which are at present assessable, will be disregarded.
Section 8 of the Bill will allow prisoner's wife's allowance to continue to be paid for four weeks after the prisoner's release. Under present legislation the allowance ceases to be payable immediately the husband is released from prison, but the extension now provided will assist prisoners to adjust to freedom and normal living without having the added problem of an immediate financial crisis in the home.
Section 27 relates to the provision in the Acts which requires an old age pensioner to repay any pension overpaid as result of a failure on his part to notify in due time an increase in his means, regardless of whether or not there was fraudulent intent on his part. This mandatory requirement to repay can cause hardship in certain circumstances and section 27 will enable the Minister for Social Welfare to exercise discretion in dealing with the question of overpayment of pension in such cases in future.
The overall cost in 1979 of the rates increases and other improvements being provided for following the budget is £65.7 million. Of this, social assistance accounts for £33.7 million, all of which is borne by the Exchequer. The total cost on the social insurance side is £32 million and this must be met out of the Social Insurance Fund which is financed by contributions from employers and employees with an annual subvention from the Exchequer. The Exchequer will meet an estimated £6.4 million of this extra cost leaving £25.6 million to be borne by contributions. The cost to contributors of the social insurance improvements in this Bill will be met from the new fully pay-related contributions which, under the Social Welfare (Amendment) Act, 1978, will be payable from 6 April next.
Some of the provisions of the Bill are due to come into operation on 28 March and it is necessary, therefore, that the Bill should be enacted before that date.
I, therefore, commend the Bill to Seanad Eireann for speedy and favourable consideration.