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Seanad Éireann debate -
Tuesday, 25 Mar 1997

Vol. 150 No. 13

Social Welfare Bill, 1997: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

Tá áthas orm bheith anseo agus tá siúl agam go n-éirí go maith linn inniú leis an mBille. I am pleased to be here in the Seanad today to introduce the Social Welfare Bill, 1997.

The Social Welfare Bills which are enacted each year in the aftermath of the budget will always be among the most significant legislation to come before the Oireachtas. This is because they serve the vital purpose of protecting and improving the living standards of so many people — pensioners, people with disabilities, the sick, the unemployed and families — by giving legislative effect to the increases in the various rates of social welfare payments announced at budget time. While this Bill is no different in that respect, it, allied to other social welfare legislation introduced by this Government over the past few years, carries an added significance.

This legislation effectively underpins the radical transformation of the social welfare system which has been undertaken in recent years. It also reflects the change in focus and ethos of the Department of Social Welfare which has stemmed from a recognition of the fact that alongside the provision of critical income support there is a need to ensure that the social welfare system is able to actively support the aspirations of people to participate in a full and meaningful way in society by facilitating them in gaining access to training, education and employment.

The Bill exemplifies this two pronged approach. It comprises a wide ranging and comprehensive package of measures which provides for an improvement in the living standards of all who receive social welfare through increases in weekly rates of payment which are double the projected rate of inflation for the year; it continues and enhances the pro-work and pro-family policies which have been central to the Government's work; it completes the process of ensuring equal treatment of men and women in all social welfare schemes; it brings about further significant reform of our social welfare system through the introduction of new pro rata pensions and it introduces a new payment entitled sickness allowance to provide a more appropriate response to the needs of certain social welfare recipients and strengthens the social insurance system by enhancing the benefits available to all workers who pay social insurance.

Before proceeding to set out the purpose of various sections, I wish to draw attention to specific measures in this Bill of particular importance in the development of the social welfare code.

First, I am pleased the Bill provides for the introduction of improved pro rata contributory pensions. No doubt many Senators will have been witnesses to the frustration of people who, for a variety of reasons, may have a broken or sporadic social insurance contribution record over their working lifetime, and find that when they reach the relevant age they have no entitlement to a contributory pension. This group includes women who may have worked for a number of years prior to getting married, then spent a long period outside of the paid workforce, for example, on home duties, and who may have later returned to paid employment. The group may also include self-employed people who started on their own before 1988 when PRSI for the self-employed was introduced. It may also include returned emigrants whose work period abroad cannot be reckoned for pension purposes in Ireland. The provisions contained in section 12 will greatly benefit those people.

The present conditions require a minimum average of 20 contributions over a working lifetime in order to qualify for the minimum rate of pension. Under the new arrangements, reduced rate old age contributory pension will be payable to persons who have a yearly average of between 10 and 19 contributions from when they first became insured until the end of the contribution year before reaching age 66. Regulations under this section will provide that people with a yearly average of between 15 and 19 contributions will qualify for 75 per cent of the maximum rate while those with an average of 10 to 14 contributions will qualify for 50 per cent of the maximum rate, provided they have a minimum of 260 paid contributions. As the current minimum rate of pension is 92 per cent of the maximum rate, the rates of pro-rata pension payable are reasonable by reference to the low averages required. These new arrangements will come into effect in November 1997.

In line with the recommendations in the final report of the National Pensions Board, section 12 also provides for an increase in the number of paid contributions required for entitlement to old age contributory pension from 156, that is, three years to 520, that is, ten years.

Given that this represents a fundamental change to state pension provision, the increase is being introduced in two phases — an increase to 260 paid contributions in the case of a person who reaches pension age on or after 6 April 2002 and an increase to 520 in the case of person who reaches pension age on or after 6 April 2012. The ten years of contributions may comprise an aggregate of 520 qualifying and voluntary contributions of which at least 260 must be qualifying contributions. In addition, a person who is a voluntary contributor on or before 6 April 1997 may qualify on the basis of an aggregate of 520 qualifying or voluntary contributions of which at least 156 must be qualifying contributions. Similar changes in the contributions required for retirement pension are also provided for in this section. The number of paid contributions required for the purpose of becoming a voluntary contributor is being increased from 156 to 260 with effect from 6 April 2002.

The second issue I want to highlight is contained in section 13. It involves a change in the rules relating to requalification for unemployment benefit. It will have a substantial beneficial effect on the incomes of many workers, particularly seasonal and casual workers, such as dockers, firefighters, creamery workers, hotel staff and people in the tourism industry.

Since 1992, such workers were precluded from requalifying for unemployment benefit until they had a further 13 PRSI contributions paid after they had exhausted their entitlement to unemployment benefit. That meant that until such time as they acquired the necessary 13 contributions they had to have recourse to unemployment assistance which was means tested and took account of their earnings from casual employment. The method by which those earnings were assessed caused particular difficulties in areas where the volume of casual work available was declining. Thus many workers found themselves on a reduced rate of unemployment assistance or no payment at all on the basis of projected earnings which had not materialised.

Section 13 provides that a person can requalify for unemployment benefit by having the necessary 13 PRSI contributions paid at any time after the 156th day of unemployment, that is, six months. This means that where 13 requalifying contributions are paid between the 156th day and the 390th day, the claimant can requalify for unemployment benefit immediately after the 390 days have been exhausted. Instead, therefore, of having to have recourse to unemployment assistance, a claimant in those circumstances will requalify for a further 15 months of unemployment benefit.

It is expected that at least 5,000 casual workers who are currently receiving reduced rates of unemployment assistance will benefit by an average of £11 per week under the new arrangements. This is, I believe, an important improvement which further strengthens the social insurance system and makes it even more worthwhile for people to work and pay PRSI.

A third notable feature of the Bill involves the introduction of a new social assistance scheme, which will be known as sickness allowance. Under the existing arrangements, people who are incapable of work due to illness but do not satisfy the contribution conditions for disability benefit or the qualifying conditions for receipt of disability allowance must have recourse to supplementary welfare allowance in order to secure income support.

As Senators will be aware, supplementary welfare allowance is a safety net mechanism for people who do not qualify for a social welfare payment or whose special needs are not covered by social welfare payments generally. During 1995 there were over 12,000 cases where SWA was paid to people who were unable to work due to illness but had no entitlement to either disability allowance or disability benefit. SWA was never intended as a sickness payment. Consequently, I am providing for the introduction of the new sickness allowance which will complete the cover available under the social welfare system for those who are unable to work due to illness or injury.

Sickness allowance will be payable at the same rate as unemployment assistance, that is, at the short term rate of assistance for the first 15 months and at the long-term rate thereafter. To qualify for the allowance a person must be aged 18 years or over and under age 66 years, be incapable of work and satisfy a means test. The provisions as to the assessment of means will be specified in regulations. I envisage that sickness allowance will provide for an estimated 13,500 people per year who are incapable of work due to illness and currently seek SWA.

Sections 1 and 2 contain the usual provisions relating to the short title, construction and definitions used throughout the Bill.

The increases in the weekly personal and adult dependant rates of social insurance and social assistance payments announced in the budget are provided for in sections 3 and 4. All personal rates are going up by £3 a week and all adult dependant allowances by £1.50 a week, thus providing all social welfare recipients with substantial increases of between 4 and 4.8 per cent, which is about twice the expected rate of inflation for this year.

Section 5 provides for increases of £1 in the lower rate and £5 in the higher rate of child benefit, with effect from 1 September 1997. These increases will bring the rates to £30 per month for each of the first two children and to £39 per month for each subsequent child. In the past three years, child benefit has increased by 52 per cent for a three child family and 54 per cent for a five child family. In 1991, a four child family got about £70 a month; this year they will get £138, which is nearly double that. The dedication of substantial resources to child benefit in recent years represents part of our planned strategy of reforming income support for children, removing disincentives to employment and working towards putting in place a system of basic income for children.

Section 6 provides for an increase of £10 at each point in the weekly income thresholds used to determine entitlement to family income supplement. The effect of this threshold increase is that virtually all current recipients will get an extra £6 in their weekly payments from mid-June next.

The new weekly thresholds range from £205 for a one child family to £344 for a family with eight children or more. This section also provides that from 12 June 1997 the rate of FIS payable will be calculated on the basis of gross earnings less any superannuation, PRSI and levies which may be payable. This revised calculation method is an important first step towards meeting the commitment we made in Partnership 2000 to base FIS entitlement on net rather than gross income. The measure introduced in last year's Social Welfare Act which provided for the continued payment of child dependant allowances for up to 13 weeks to people who have been unemployed for a minimum of 12 months and who take up employment which is expected to last for at least four weeks, has helped to overcome the disincentives facing unemployed people with families who have the opportunity to take up work.

Section 7 extends these provisions to cater for other groups, namely, people on community employment immediately before taking up employment and people on the live register or on community employment who take up employment under the "jobs initiatives" announced last year.

Sections 8 and 9 reflect the changes announced in the budget last January with regard to PRSI. Section 8 provides for a reduction of 1 per cent, from 5.5 per cent to 4.5 per cent, in the standard employee contribution rate. This section also increases from £22,300 to £23,200 the annual earnings ceiling up to which social insurance contributions are payable by employees and increases from £26,800 to £27,900 the earnings ceiling up to which contributions are payable by employers.

The weekly earnings limit for the lower — 8.5 per cent — rate of employer's contributions is being increased from £250 to £260 per week. Section 9 increases from £22,300 to £23,200 the income ceiling up to which social insurance contributions are payable by the self-employed. All of these changes are to come into effect on 6 April 1997.

Sections 10 and 11 provide for the extension of maternity benefits and adoptive benefit to women in insurable self-employment along the same lines as currently available to women in insurable employment. These sections also provide for a consequential amendment to section 18(1) of the Social Welfare (Consolidation) Act, 1993, which extends the benefits covered by self-employment contributions to include maternity benefit and adoptive benefit.

I described earlier the introduction of reduced old age contributory pensions. Section 12 gives legislative effect to this measure. I also referred earlier to the reform of the arrangements for requalifying for unemployment benefit, and the relevant legislative changes are provided for in section 13.

The purpose of section 14 is to provide for two improvements in relation to the occupational injuries benefit scheme. First, it removes the more restrictive conditions applying to widowers in the case of widower's pension payable under the scheme, thus ensuring that widows and widowers are treated equally. It also abolishes the requirement that the claimant must have been living with, or have been wholly or mainly mainly maintained by, the deceased. This brings the conditions of entitlement into line with those applying to widow's and widower's contributory pension.

Second, this section extends the scope of the scheme to provide for payment of pensions to widows and widowers and to the surviving spouse and recipient of disablement benefit whose degree of disablement is assessed at 50 per cent or more, irrespective of the cause of death. The purpose of this provision is to overcome a problem which arises with the existing arrangements in cases where the cause of death cannot be attributed directly to the occupational injury or disease.

I spoke earlier about the introduction of a new social assistance payment to be known as sickness allowance. The relevant legislative provisions are contained in sections 15 to 18. Section 17 provides for disability benefit to be renamed sickness benefit and invalidity pension to be renamed disability pension to more accurately reflect the contingencies these payments are designed to meet.

The completion of our programme of implementing equal treatment of men and women across the social welfare code will be achieved by virtue of the provisions contained in sections 19 to 21 which introduce a new scheme which will be known as the widower's non-contributory pension scheme. This new payment is designed to meet the needs of widowers who are not rearing children; those who are will continue to receive the one-parent family payment. It will be available to widowers on the same basis as the existing widow's non-contributory pension. This part of the Bill also extends entitlement to the new widower's pension to divorced men on the death of their former spouse, provided that they have not remarried and that they continue to satisfy the other conditions of entitlement. Similar provisions have already been put in place for widows in the Social Welfare (No. 2) Act, 1995.

Section 22 provides for a number of important improvements to disability allowance. It provides for regulatory powers to extend entitlement to disability allowance to persons who reside in an institution on a part-time basis and otherwise reside at home. The allowance will be payable to such people at half of the standard rate, subject to means.

Section 22 also provides that where one of a couple is in receipt of disability allowance and the other is in receipt of old age non-contributory pension or invalidity pension each of the couple may receive the full personal rate of payment. This section also provides that the cost of medical certificates issued for the purpose of claiming disability allowance and the new sickness allowance scheme will be met by the Department.

Two notable improvements to the carer's allowance are provided for in section 23. First, provision is being made for the payment of an additional amount, equivalent to 50 per cent of the existing personal rate, to carers who are providing full-time care and attention to more than one person. This measure aims to recognise the particular difficulties faced by those caring for more than one person and could benefit as many as 2,000 recipients of the allowance. Second, this section provides regulatory powers to relax the condition requiring full-time care and attention so as to entitle carers of incapacitated people attending rehabilitation training or day care centres on a limited basis to the allowance.

Section 24 provides that people who cease to be entitled to the one parent family payment or the carer's allowance may qualify for pre-retirement allowance without first having to have been in receipt of unemployment payments for 15 months as would ordinarily be the case.

The provisions contained in section 25 represent an important step towards the achievement of a more uniform, consistent and even handed treatment of capital and savings for means test purposes across the range of social assistance schemes by applying new and more generous rules to all means tested pensions and to carer's allowance.

Section 26 consolidates the provisions relating to amounts disregarded in the assessment of means for social assistance payments. It also makes provision for disregarding rental income from the assessment of means for old age non-contributory pension where the income involved is in respect of a person who lives with and pays rent to the pensioner. Section 27 states that the measures contained in sections 22 to 26, inclusive, will be brought into effect by way of commencement order.

The provision of section 28 are being introduced as a result of measures announced in the budget to deal with the poverty and unemployment trap created by the withdrawal of the adult dependant allowance — ADA — and half the child dependant allowance once the earnings of the spouse of a claimant exceeds £60 per week. This problem is being tackled by the introduction of a tapered withdrawal of the ADA in the case of recipients of a number of social welfare payments. Under existing provisions, where the spouse of a claimant to a social assistance payment is not his or her dependant, the claimant is assessed with the joint means of the couple. The purpose of section 28 is to amend these provisions to provide that, on the introduction of the tapered rates of ADA, a person in receipt of a reduced rate ADA will only be assessed with half the joint means of the couple.

Section 28, with Schedule F, also replaces the term "adult dependant" used for the purposes of paying an increase of benefit or assistance in respect of a spouse or partner with the term "qualified adult". This change in terminology is in line with a commitment I gave during the debate on last year's Social Welfare Bill.

Section 29 provides for a strengthening of the rights of citizens in circumstances where decisions relating to what are known as "liable relatives" are made by the Department or the health boards. The position at present is that where one parent family payment or supplementary welfare allowance is paid to a person, any other person who is liable to maintain the beneficiary and any child in respect of whom an increase is payable, is liable to contribute such amount as may be determined by the Department, or the health boards in the case of supplementary welfare allowance, towards the benefit or assistance payment in question. As these decisions are made on an administrative basis, in that they are not formal decisions made by deciding officers appointed under the Social Welfare Acts, the person concerned does not at present have the right to appeal.

Section 29 provides that these decisions will now become a deciding officer function and will thus afford the person concerned the right of appeal to the independent social welfare appeals office. In addition, it provides for regulatory powers to specify the basis on which the contribution which a person is required to pay is to be calculated. Section 29 also provides that a divorced person will remain liable to contribute towards the cost of the benefit or assistance paid to their former spouse and extends the definition of order of the court to include maintenance, lump sum, variation and interim orders in respect of maintenance made by any court. These provisions will be brought into effect by way of a commencement order.

A number of provisions relating to unemployment payments are contained in section 30. First, it provides that the provisions under which a person is not paid for the first three days of a claim for unemployment benefit, known as waiting days, will not apply in the case of a claim for benefit made following a claim for disability benefit in the same period of interruption of employment. Second, it provides for regulatory powers which will be used to eliminate the requirement to serve waiting days for unemployment assistance purposes, in certain circumstances.

Third, it enables the Minister for Social Welfare to make regulations specifying the circumstances under which an unemployed person will be regarded as being available for and genuinely seeking employment for the purposes of entitlement to unemployment benefit and unemployment assistance. Finally, section 30 provides that people who, prior to their participation in the European voluntary service pilot action programme, were in receipt of unemployment benefit or unemployment assistance can resume such entitlement on completion of the programme. This programme, which was recently launched by the Commission of the European Union, is open to young people between the ages of 18 and 25 and is administered on behalf of the Department of Education by Léargas.

The provisions of section 31 of the Bill state that where a person who receives a social welfare payment by way of personation is subsequently convicted of the criminal offence of larceny, the amount of the payment to which the offence applies may be recovered from any social welfare payments to which the person is or becomes entitled.

Section 32 incorporates into primary legislation existing regulatory provisions governing the payment of arrears on foot of late claims for the various social welfare payments into primary legislation. Under existing provisions, the payment of arrears to people who fail to claim within the prescribed time is generally limited to six months the this section extends from six to 12 months the period in respect of which arrears of old age contributory pension, retirement pension, widow's contributory pension, widower's contributory pension and orphan's contributory allowance may be paid. It also provides for payment of arrears of up to six months in the case of late claims for family income supplement. Under the present arrangements, there are no provisions whatsoever for payment of arrears of FIS.

The opportunity was taken to introduce an amendment to this section in the Dáil, the effect of which is to make the current arrangements more flexible and responsive where claims are made outside the prescribed time. Senators will be aware that the whole issue of arrears in respect of late claims has given rise to a certain amount of criticism over the years, particularly in so far as claims for old age contributory pension and widow's and widower's contributory pensions are concerned. A number of complaints against my Department have been made to the Ombudsman over the years and the issue has been highlighted in several of the Ombudsman's annual reports. The issue is currently the subject of an investigation under section 4 (2) of the Ombudsman Act, 1980, and the provisions of section 32, as now amended, arise from some of the issues raised by the Ombudsman in the various consultations which have taken place with my Department during the course of the investigation.

The amendment provides for regulatory powers under which arrears may be paid for periods in excess of the six and 12 month limits specified in subsection (2) subject to conditions and in circumstances to be specified in the regulations. These decisions will be made by officers appointed by the Minister for this specific purpose. I believe that these powers will prove to be sufficiently broad to provide the flexibility required to address the issues arising from the Ombudsman's investigation.

Section 33 of the Bill provides for the collection of PRSI by my Department from certain categories of self-employed contributors. PRSI is normally collected by the Revenue Commissioners on behalf of my Department but there is a need for my Department to have powers in this area to enable PRSI to be collected from people who are exempt from tax liability, such as certain artists. I am not referring here to particular artists.

This section also provides that a person who became insured as a self-employed contributor after reaching age 56, and who was previously insured as an employee, will be entitled to a refund in respect of the old age contributory pension element of their self-employment contribution in cases where they do not qualify for old age contributory or non-contributory pension. Finally, section 32 also provides for regulatory powers to refund part of the employer's portion of contributions paid in respect of seafarers.

Section 34 is a new section introduced on Report Stage in the Dáil. Its purpose is to provide that social welfare appeals may, in certain circumstances, be referred for hearing to the Circuit Court rather than to an appeals officer. Senators will be aware of the appeals procedure in the case of social welfare claims. Where a person is dissatisfied with a decision on their claim, they may appeal against it to the chief appeals officer in the social welfare appeals office. The appeals service provided by that office is independent and impartial and is provided in an informal manner in keeping with the needs of social welfare claimants.

The administration of the social welfare system inevitably involves having to deal from time to time with difficult and potentially dangerous situations where staff of the Department could be subject to threats or intimidation. Senators will recall that it was necessary last year to provide in some instances for investigations and decisions on social welfare entitlement to be carried out by the Criminal Assets Bureau. Under the Criminal Assets Bureau Act, 1996, I may refer cases to the bureau for investigation and determination where there are reasonable grounds for believing that such threats may exist. In this way the investigation and deciding functions are taken from Department officials and given to the bureau. The functions of the bureau are carried out with necessary safeguards for the staff of the bureau.

Section 34 is intended to apply a similar level of protection to appeals officers. Having considered how best this might be done, I have concluded that the most reasonable approach, which will preserve the right to an independent appeal, is to provide for an appeal to the Circuit Court in such cases. The service provided by the social welfare appeals office would not be adequate to cope with appeals which might require, for example, special arrangements for the anonymity of witnesses at an appeal hearing; neither would it be possible, under existing arrangements, to provide necessary safeguards similar to those available to officers of the Criminal Assets Bureau for the appeals officer hearing such appeals.

The procedure envisaged in this section is straightforward. In relevant cases, the chief appeals officer may direct that the person submit the appeal to the Circuit Court which will determine the appeal in accordance with social welfare legislation and on the same evidence available to the appeals officer. The decision of the court would, as is the case with appeals officers, be final and conclusive except, of course, for the general right of appeal to a higher court on a point of law. I emphasise that this process will be used sparingly and will not affect the vast bulk of normal appeals made to the social welfare appeals office.

Section 35 provides for the amendment of a number of references to regulatory provisions contained in the Social Welfare (Consolidation) Act, 1993, as a result of the consolidation, in 1996, of regulatory provisions relating to contributions and insurability. This section also provides for the deletion of subsection 212(7) of the 1993 Act which provides that a person shall not be required to give any evidence or answer questions tending to incriminate himself. This provision is regarded as unnecessary in that there is a recognised common law right against self-incrimination and it would be more appropriate for a court to decide whether the right may be relied upon in the particular circumstances of a case.

Section 36 is a technical measure which provides for the continuity of regulations made under the Social Welfare (Consolidation) Act, 1993, which are being amended by this Bill.

Section 37 provides for the amendment of the functions of the National Social Service Board, which were bestowed on the board when it was originally established under the aegis of the Department of Health in 1984. In 1995, responsibility for the board transferred to my Department and, consequently, it is appropriate that its functions should be reviewed in light of that transfer of responsibility. The revised functions are designed to reflect more accurately the important role played by the National Social Service Board in promoting and supporting independent information, advice and advocacy services throughout the country to ensure that all citizens have access to accurate, comprehensive and clear information on the full range of social services.

Sections 38 and 39 provide for a number of changes relating to health contributions and the employment and training levy and are introduced at the request of the Ministers for Health and Employment and Enterprise.

Section 40 introduces an amendment to the Pensions Act, 1990, to provide legal certainty in respect of the power in the Act to make regulations in respect of external pension schemes, that is, those schemes established in another jurisdiction which have members in Ireland. The amendment arises as a result of concern expressed by pension practitioners in Ireland and the UK regarding the situation that will arise when the UK Pensions Act comes into force in April of this year, particularly as it relates to schemes with members in both Ireland and the UK.

Existing pensions schemes established in the UK, but with members in Ireland, may, from April 1997, technically be subject to the laws of two jurisdictions as will be the case for Irish schemes with UK members. While the legislation of both countries in regard to pensions will be broadly similar, there are some differences which will cause difficulties to schemes and practitioners dealing with them. For example, members of Irish schemes based in the UK could be liable to the indexation requirements of the UK which are different from the revaluation provisions in Ireland. Accordingly, pension practitioners are pressing for legal certainty in regard to such schemes.

This Bill forms an integral part of our strategy to make the social welfare system more equitable, dynamic and responsive to the ever changing needs of Irish society. The provisions in the Bill will have the effect of further enhancing the social welfare system and demonstrate the desire of the Government to ensure that it is capable of providing the best possible service to all those who, for one reason or another, are reliant upon it.

I commend the Bill to the House.

This is the third time I have sat on this side of the House for the introduction of a Social Welfare Bill. One's arguments at times become repetitive when trying to decide whether these Bills represent a transformation of the social welfare system or are a continuation of a transformation which began many years ago. At the outset, I welcome the positive provisions in the Bill. However, in times of high economic growth, many individuals claim that not enough action has been taken in respect of those who most require social welfare payments. That has been borne out by various commentators and agencies in recent weeks.

The Social Welfare Bill merely inserts into legislation the measures introduced in the budget. During the budget debate there were many positive speeches about the booming economy and the wonderful transformation in our society. Having listened to the Minister's contribution, it is apparent that the Bill is all hype because, while it contains many worthy measures, a large number of people will only benefit from paltry financial increases. When in Opposition, some members of the Government claimed they would change the world when they came to office. However, after three budgets, nothing much has been done. There have been a number of percentage increases in some areas but society has not fundamentally benefited. In the past, because of the lack of resources, budgets and Social Welfare Bills could only try to maintain living standards but people dependent on social welfare should be entitled to the fruits of a booming and buoyant economy.

If we are to adjudicate the Government's performance on social solidarity, we must highlight the fact that, under three Social Welfare Bills, this Minister has increased old age pension payments by a mere £7. The Government has made continuous statements about exceptional growth, increased revenue intake and the great prospects that lie ahead. However, it is difficult to explain that to a person under 80 years of age on a widow's contributory pension who will now receive £71.10 per week.

While I acknowledge some of the positive aspects of the Bill, the reality is that the elderly in society have again been let down. The Minister will point out that the rates of pay are above those recommended by the Commission on Social Welfare, but is it not time to ask whether a new review body should be established to analyse social welfare payments in light of the fact that this country has turned the economic corner and has more resources at its disposal for those in most need? It is time to consider the setting up of a new commission, given that we are entering a new era and economic indicators suggest that the county is moving forward in a financial sense. While payments may be in excess of those recommended by the commission, even taking account of inflation, the consumer price index, etc., they may not necessarily be considered adequate to support a decent standard of living in the current climate.

Another issue highlighted on numerous occasions in debates on social welfare in the House is the assessment of board and lodgings against parents' income. Any unemployed young person who wants to have independent means and is living with parents who work is forced by the system to leave the family home and live in rented accommodation. They then receive social welfare payments and the State is obliged to pay their rent allowance. This is a gross waste of taxpayers' money and forces young people, who may still be vulnerable, to live in accommodation and a climate which may not be conducive to their personal development. I urge the Minister to consider this whole area as it is not only a waste of revenue but is contributing to social problems. It is also putting pressure on the rented housing sector and costing us more in rent allowance. Everyone is aware that there are young people who will not remain at home for £5 per week but they will leave home and receive £67.50 in addition to a rent allowance. The logic of this must be seriously questioned. This issue has been highlighted by many Members in the past.

This Minister has continually highlighted the substantial increases in child benefit which are very welcome — I concur with his statement that the doubling of child benefit for a family of four since 1991 is a good development — but the Government has been very unfair to the children of the most disadvantaged in our society who are dependent on social welfare. However, it must be clearly stated that there has been no increase in the child dependent allowance paid to social welfare recipients. Regardless of socio-economic background, the same rate of child benefit payment applies. In other words, a child whose father is unemployed and living on a day to day basis receives the same payment as a child whose parents are working in highly paid professional employment, yet this Minister did not think it necessary to increase the child dependant allowance. Again we must question this Government's commitment to social solidarity.

I am also concerned about the operation of the social insurance fund. I accept some employers and employees view PRSI as a form of income tax but the social welfare fund is being squeezed and diluted. The PRSI system was introduced some years ago as an insurance fund into which people can pay and claim benefit when sick or unemployed. However, we do not respect the dignity of those who pay into the fund. When they make a claim they are seen as sponging on the system. We do not treat those who have paid into the fund all their lives differently from those on assistance. If I pay into an income continuance scheme and am out of work because of illness, no-one would suggest that, in drawing down my insurance fund, I would be sponging on the system, but such a perception exists in regard to the social insurance fund. That is regrettable because it has damaged people's views about PRSI and the fund. The Minister is probably as conscious of this as I am.

The introduction of social security for the self-employed in 1988 by Fianna Fáil was a major breakthrough. It provided many thousands of people with old age and widow's pensions for the first time. Great concern was expressed about the collection of contributions and the solvency of the fund. Contributions increased from £46 million in 1989 to £93 million in 1996 and to date the self-employed have contributed £587 million to the social insurance fund. The scheme is working well and funds are available to improve benefits.

There are two priorities for improvements. First, the benefits should be extended to include occupational injury benefit and invalidity pension because contract workers on buildings sites must have cover for occupational injury. Farmers and fishermen should also be covered as should other categories of the self-employed. Second, pensions should be provided for those who were over 56 years of age when they were brought into the system, because since they have fewer than 10 contributions, they cannot receive old age pensions unless they were previously insured. Taking into account the success of this cash rich scheme, the Government failed to take the necessary and feasible steps and instead raided the scheme to gain popularity in an election year.

This was also a year when the Government could have advanced the date of payment of social welfare increases to 6 April in line with the new tax year. The Fine Gael-Labour Coalition Government delayed the payment of social welfare increases until September, purely to balance the books. Fianna Fáil moved the date to July and more recently this Government moved it to June. Last year the Minister indicated the might bring the increases forward to April but, alas, this has not happened. Widows, unemployed people and thousands of pensioners expected that the pay date for increases would be restored to April. This has been another disappointment. It was stated publicly last year that the policy of bringing the date forward would be continued.

Has the Minister undertaken any review of the cost of the carer's allowance and its attendant means testing in comparison with the cost of nursing home accommodation? This issue will haunt us for years to come. In many nursing homes it costs £250 per week to maintain a person. In the case of an elderly person in receipt of an old age pension this will necessitate the maximum subvention of £120 with a resulting deficit of anything between £50 and £100 depending on the type of nursing home. There is a fundamental need to reassess the support we give to carers of the elderly and there are many positive economic advantages to giving decent financial assistance to people who are willing to care for the elderly and disabled.

While an elderly person retains a degree of good health the last thing he or she wants to do is go into a nursing home. Most prefer to remain at home within their local community. However, due to the means testing of the carer's allowance, many young people who might other wise maintain an elderly parent or relative at home refrain from doing so. The cost of paying a person who decides to care for an elderly relative and maintain them in their home environment would be considerably less than a nursing home subvention and would be of greater benefit to society and the community in general. The care and attention the family gives an elderly relative in their home would be rewarded.

I strongly urge the Minister to review this area and the present means testing system, bearing in mind the demographic changes and the projection that, by the year 2025, we will have an elderly population and the present system of care for the elderly will not be sufficient. If we are serious about planning for the future, it is incumbent on us to encourage and develop a system that will give our elderly maximum care and attention. If there was an assessment of the carer's allowance and if extra nursing resources were provided in the community, people would be encouraged to care for their elderly and disabled relatives at home.

Apart from being paid their weekly unemployment assistance or benefit, many of the long-term unemployed seem to have been forgotten by the system. If we are serious about ensuring that the wealth and prosperity currently enjoyed by some will also be benefit those in need, we must undertake a fundamental review of the tax and social welfare systems coupled with additional resources for adult education and training programmes so that in the event of a job opportunity arising for a person on long-term unemployment, not only would it be financially advantageous to take up the work but there would be an element of State support, through training, to ensure that the person could take full advantage of any such opportunity. I acknowledge there have been some positive improvements whereby a person on long-term unemployment who finds work is allowed to retain some of his or her social welfare benefits. However, many of the long-term unemployed no longer have the confidence or training to enable them avail of work opportunities. Sadly, in many areas particularly in cities, many people do not know what it is like to go to work and their children are brought up in an environment where work is almost alien to them. This can no longer be tolerated. Massive resources must be injected into these areas to provide the necessary training and social infrastructure to give them hope.

To date, our approach to long term unemployment has been ad hoc with no clear long term vision. In times of high economic growth it is incumbent on us to ensure that the social evil of long-term unemployment is firmly tackled because, if we have not addressed this problem when the economic pendulum swings, we will have reneged on another generation and consigned them to the economic dustbin.

The Minister said that the provisions of the Social Welfare Act and this Bill have transformed the Social Welfare system as we know it. That is an invitation to Members of the House to adjudicate on his performance over the past three years. When Deputy De Rossa was appointed Minister for Social Welfare there were high expectations that he would transform the social welfare system and, in turn, society. This perception arose because of his years in Opposition when he continually attacked successive Ministers for their lack of understanding and commitment to those on welfare. However, it can safely be said that there has been no radical transformation, only a tinkering with and adjustment of the system. It is true that the expectations of many were short lived. Given the unprecedented economic growth and buoyant revenue, this Minister has squandered an opportunity to make a real difference so that people on social welfare receive a decent income and those seeking work have the incentive to do so.

Recent ESRI studies suggest that long-term unemployment will continue to be a persistent social problem. This will lead to a high demand for unemployment payments, notwithstanding rapid economic growth. In this context radical changes are required. Initiatives such as family income supplement and the back to work allowance scheme have been introduced but much remains to be done. There is no evidence to date to suggest that the Minister has fundamentally changed the social welfare system to benefit those most in need. This is not surprising, considering the Government's overall performance.

I welcome the Minister to the House after his marathon and unfair battles elsewhere. I compliment him on his dedication in discussions with senior counsel; it shows he is well able to debate.

I also compliment him on the Bill. I agree with Senator Kelleher that there should be changes in many areas but over the last seven to ten years we have seen changes in the Department of Social Welfare, irrespective of who was Minister. We see new structures this years also and I am happy that many of them were introduced as a result of long discussions in both Houses. We could discuss every year where the £4.4 billion should be spent. Senators like myself feel that some people are not getting enough and some of those paying into the fund wonder whether it is being spend in the right places. From a social welfare point of view are we focusing on the right people? We must examine it with a view to simplifying it. Many elements have been simplified. Child benefits have been reduced to six or eight payments when at one stage there were 32 different payments for children.

I am glad the Minister is concentrating on the increases in rates. He talked about a rate of inflation of 2 per cent for 1997. I think inflation will be less than that; therefore, the increase in social welfare rates of 4 per cent will be over twice the rate of inflation. In the past year or two we complained that the increase was only 3 per cent but that has been increased to 4 per cent. I have argued for a long time that we should concentrate on increase in terms of amounts of money and not percentages and I am glad the Bill takes this approach. This is a welcome development for those who wish to be informed about their social welfare benefits.

The reintroduction of short-term contributions is to be welcomed for the casual workers who lost out in the past. These workers can now go back to work and have their casual contributions taken into account. It was most unfair that they were not entitled to certain benefits.

When we discussed the Pensions Act, 1995, we considered what might be the best way to ensure people could receive the most benefit and section 12 will ensure we get value for money and that the benefits will go to those who most need them. These aims must be our priority. In this era of economic growth we must ensure that people gain from the welfare system. In my view not enough people are gaining from it. This and earlier Social Welfare Bills have examined many payments. The new sickness allowance is a subject we have considered in the past and this Bill simplifies the allowance and benefit provisions. I welcome this measure.

The general increases in the rates of child benefit and adult dependant payments are between 4 per cent and 4.8 per cent, levels of increase we have not seen for a long time. Those increases are welcome. However, we must ask ourselves if the social welfare recipients are getting enough, particularly the elderly. The elderly are doing well from the social welfare system but they will do even better if we pay for home care.

The Minister deserves credit for the carer's allowance which has been increased greatly this year. This indicates our commitment to caring for the elderly in their homes. The carer's allowance should be availed of wherever possible because it fulfills a social need. It is a compassionate allowance.

The family income supplement is to be increased, another indication that those in lower paid employment will benefit. The new weekly thresholds range from £205 for a one child family to £344 for a family with eight or more children. In accordance with the commitment given in Partnership 2000, this relates to the net rather than the gross income and deals with amounts rather than percentages. The Minister is to be complimented on this increase. I wonder if the family income supplement scheme is getting the attention it deserves so that the low paid are aware that they are entitled to benefit from the scheme. However, some people may not wish to avail of the scheme because of the way the supplement is paid. I will speak in detail on this point on Committee Stage.

I welcome the increases. They prove that the money being spent is benefiting the family unit and not just individuals. There are other areas in which individuals are not getting enough, for example, young people who have to leave home. I agree with Senator Kelleher that, although the amount of their entitlements has increased, a large number of young people leave home in order to qualify for increased benefits. We must examine this matter because it causes social havoc and undermines young people. I was shocked to find that there were over 10,000 people, between the ages of 18 and 21 years, who have left the family home just to get the extra money. This causes increased costs in benefits and rent allowances. I know the Minister is aware of the problems in this regard.

The Bill looks at areas where we can spend more and provide benefits to get people back to work. There were 50,000 extra jobs created last years and although I will not argue that they have solved the unemployment problem, it means 50,000 people are no longer unemployed. I wonder if enough recognition is given to the problems of the long-term unemployed. Last week I had an argument with a person who has been unemployed for seven years. He has a family of three and if he was to accept the job offered to him he would be getting an extra £10.50 per day. I see his point. It does not necessarily mean he was being offered a low wage. However, the structure of social welfare benefits meant he was working for £10 per day extra. It is very easy to get into a rut after being unemployed for seven years. We should debate the issues involved in such cases and face up to them.

The faster we amalgamate PRSI and PAYE the better. The commission investigating the operation of the Department of Social Welfare and the future structures of tax and PRSI made a recommendation along this line. There should be one form of taxation. I do not understand how a person who earns over £23,000 is exempt from further PRSI contributions while the person earning under £23,000 and over £9,000 has to pay. An employer who pays over £26,000 or £27,000 pays no further PRSI contributions. We should base arguments on how best to spend the available money having compared the earnings and benefits of those in the high and low income categories. I understand the Minister's provisions regarding PRSI as outlined in sections 8 and 9. I do not normally speak to simply compliment people but I compliment the Minister on these provisions.

The other areas being recognised in the Bill are maternity and adoption benefit, pro rata pensions, unemployment benefit and occupational injury benefit. I am particularly delighted about the pro rata pensions benefits. All these benefits are being recognised by the Department as being in need of change.

Widowers did not get the same recognition as widows but the same benefits are now provided because of EU equality regulations. There is no area now where a widower does not enjoy the same benefit as a widow. We should discuss a carer's benefit or allowance in the context of the widow's and widower's benefit if they want to bring somebody in to look after their children.

I am concerned about the long-term unemployed. There is a category of people, particularly men, whom we do not seem to be able to help sufficiently to enable them re-enter the work force no matter what we do to the social welfare structures. What are we doing wrong? We can help short-term unemployed and young women to get work; we can also help young men but there is a category of men in particular for whom we should show more concern because there is a tendency to think they will never again be in gainful employment. In Cork there are families where two generations are unemployed. There are men of 35 or 40 years who have never worked; there are 45 year old men with 20 year old children who have never worked. This is a sad reflection on society, especially in the context of how the economy is growing. We are not facing up to the problem.

We should ask people who are doing well whether enough is being done and we should ask employers how we can all help these people. PRSI rates have been reduced and benefits have been given to employers, but there seems to be a lack of priority in providing employment for men who are long-term unemployed. It is a sad reflection on society because they have much to contribute. It is also sad for men to see their spouse going to work when they have never worked. We are failing in addressing this issue. However, we should not admit defeat.

There has been an increase in money provided for the Department — and the Minister has argued at Cabinet for this — and this can be used to help young people who leave home at an early age and the long-term unemployed who do not enjoy the benefits of economic growth.

Section 29 raises the liability to maintain the family. This is an opportunity for us to say that we are committed to the family which is the backbone of society. The Department has not only expressed its view on the necessity of keeping the family unit together but it has proven its concern by providing an enormous increase in benefit for the third and subsequent children. Next year the increase should be for the second and subsequent children. Each child should be provided for equally. Benefit should not be denied because both spouses are working as that is regulated by taxation. That is why I would never argue that a review of the 48 per cent tax band should be a priority. If a person is making money they should pay tax. However, the bands should be broadened.

When we look at the carer's allowance and child benefit we see there is an obvious commitment by the Department of Social Welfare and the Government to the family unit. Many people have commented about how loose our definition of family is becoming in the context of one parent families and common law spouses. Demands for stringency should not be made when we are dealing with children. All children are equal. The review of unemployment benefit and waiting days is also welcome.

The explanatory memorandum says that section 31 provides that: "where a person who receives a social welfare payment by way of personation is subsequently convicted of the criminal offence of larceny...." How will personation be stopped? People should not be allowed to what they like but we should be compassionate.

The Minister has at long last recognised the problem of late claims, a problem which has existed for years. He is even prepared to back date this provision and he is to be complimented on that. I would like the carer's allowance, child benefit, supplementary rent allowance and supplementary allowance for low paid workers to be promoted thus ensuring that each person is well informed about the benefits to which they are entitled.

Like the Revenue Commissioners, the Department of Social Welfare has become more open in the way it promotes its services. That has happened to a great degree over the past few years. The opportunity to publicise the new benefits in relation to back payments of contributions, late claims, carer's allowance and so on should be availed of to a greater extent in the media although the Minister and his officials are to be complimented on the manner in which these changes have been publicised thus far and on the simplification of the Bill and areas of social welfare generally. The Minister can be assured that if this trend continues, people will continue to benefit. However, there are particular areas which remain to be examined in order to ensure that unemployed people get sufficient recognition.

The Bill is important as it affords the Minister and the Government the opportunity to redistribute some of the national finances in order to provide for people who find it difficult to provide for themselves. In so far as the Bill contains some welcome improvements and meets some of the shortcomings which have been noted in social welfare legislation over a number of years, it is very welcome and we will support it.

There is an underlying fear that, although we are moving in an important direction, it is happening at a very slow pace. The vast majority of people in receipt of the benefits we are discussing have an underlying dissatisfaction with the overall social welfare system. It is not that they find fault with the system's operation because this is very successful but when they compare the amount they receive to the incomes of professional and other people, they are dissatisfied. This is not something which has happened recently; I will not lay the blame at the Minister's door for that. However, in areas of high unemployment where people, owing to disabilities or whatever, find it difficult to survive it may be that they feel they are not getting a fair share of the finances. In view of the demands placed on them, many families are under pressure to survive.

The Bill does not go far enough to ensure that the less well off sections of society are adequately catered for. That is a complaint which has been levelled not only at this Administration but at Administrations in which I was involved. Having been involved in the preparation of the Estimates for the Department of Social Welfare and having held that office for a short time, I fully recognise the work which the Minister has done and the professionalism of his Department. Difficult and painstaking decisions have to be made to identify the various priorities among competing demands.

I want to put on record my appreciation of the work of the regional offices in the delivery of social welfare services. There has been a revolution in recent years in the administration of the Department. It is important that we continue to provide good customer service and that the queries that arise in this complex area are dealt with adequately and speedily. The appeals procedure continues to be criticised. It is regarded as being cumbersome and slow and has left some people in a very unsatisfactory situation. The establishment of the appeals office and its reorganisation has improved matters but there is still much scope for improvement in the speeding up of appeals decisions. I do not agree with the section, which suggests that appeals should be dealt with in the Circuit Court. I am sure the Minister has had enough of courts at this stage. The appeals procedure could be more efficiently dealt with in the District Court. Everyone is aware that it would be very expensive to deal with issues of this nature in the Circuit Court.

I recently met a couple who have been at the receiving end of an unsatisfactory appeals decisions. As they appear to be residing together, they are assessed as a family but as they have claimed to be living separately, they are separately assessed with regard to incomes. Perhaps the divorce legislation will resolve some of these matters in the coming years. However, there is much confusion about the way in which income tax is calculated compared to the manner in which assessments are made on social welfare.

It is necessary to streamline the appeals procedure. Perhaps the appeals office could be regionalised as is the case with the rest of the service. The eight regional officer are very effective. I compliment the staff in the Ennis office and in the mid-west region on their efficiency which has been greatly assisted by the introduction of information technology. People can now walk into their social welfare office and the information they seek is available on screen within a matter of minutes. This is totally different from the position where people had to make representations to politicians to get information. Politicians have seen a huge reduction in the volume of complaints received in the area of social welfare. While I welcome the administrative improvements in the regional offices, there is room for improvement in the area of appeals. The Minister might usefully look at this.

I am very concerned at the obvious link between people in poor health, those with disabilities and unemployment. I am not certain whether unemployment results in poor health or whether poor health results in unemployment. The situation is chronic for many social welfare recipients. They suffer as a result of their health and unemployment problems. Perhaps the Minister has already carried out some research in this area; I am not up to speed with the latest developments. However, it is necessary to carry out some research into the link between long-term unemployment and health and disability problems. Unemployment is creating problems in the health area for many people, particularly with regard to depression. The problem is worse in cities but it is beginning to affect rural towns. The unavailability of employment in rural areas is becoming a serious problem. Isolation is a factor too in that many people are living alone and they have little prospect of gaining employment in rural areas, especially if they are between the ages of 45 and 55 and, as a result, more people are becoming ill and depressed. There is a need for research to identify how this problem can be addressed.

People in remote areas encounter particular difficulties, and Senator Kelleher will be tabling amendments on the availability and cost of transport for people with disabilities or illnesses who seek medical attention. A few days ago a woman showed me bills for £90 for two trips from Kilrush, County Clare, to Limerick, she had to make for medical attention. This was almost the equivalent of her weekly social welfare payment. There is no public transport system to cater for these people. The Minister might identify measures to assist people who are ill and unemployed in the context of innovations in social welfare.

He might also examine the link between poverty and domestic violence. There is evidence of an increase in violent attacks on women in the home. The Clare Haven House project in my constituency provides facilities for women and children who have been attacked and have nowhere to go. The project is finding it extremely difficult to get necessary funding to provides these services. The health board provides money for some of these projects but, by and large, funding is scarce and the health boards find it particularly difficult to fund such projects. It is important that the Minister examine this in the context of his grant scheme for voluntary bodies and organisations which I welcome and support.

The amount of money available to voluntary bodies has been increased consistently over the past few budgets. The Minister made some changes in that he confined the payments to activities of a social welfare nature. Perhaps there is a need to examine that again and expand the scope of that scheme, even if it means redirecting some of the funds from the health boards to the Minister's voluntary funding schemes. I say this because I want to record the valuable work which has been done by a section of the Department on the identification of opportunities and funding of training for the unemployed for alternative enterprises. This work to retrain people using part of their welfare payments was mentioned in the Minister's diary and it is worthy of further examination. The Minister might have a section of his Department deal with that area.

Although I never really knew what was done by the Social Services Board, which has tremendous powers and responsibilities under the Bill, much advice is available from Fr. Healy's organisation and a huge range of voluntary organisations. I do not know whether that board is now necessary. I am not competent to criticise it because I do not know much about its activities but the system would improve if there was less bureaucracy and more direct payments. The Minister has several professional advisers in the Department and other advisers who can direct his attention to the areas where it is needed. Although I am not too familiar with its work, I believe this board has outlived its usefulness.

The Minister has made some important changes to the carer's allowances which I welcome wholeheartedly. The expectations for the carer's allowance were greatly exaggerated initially and this led to a certain amount of frustration and criticism of the scheme. Nevertheless, anybody who has been dealing with the public will know the cost of keeping people in institutions and the burden that places on health boards and families. The investment made in the carer's allowance has been worthwhile and I welcome the extension of it because many families are caring for more than one relative. Perhaps further adjustments can be made to it because it is desirable to encourage elderly people to remain in the family environment as much as possible. It would be far cheaper and more sensible from the point of view of families to have their elderly relatives live with them or nearby. I welcome the improvement and hope it can be expanded further as the scheme develops.

I have never been a great admirer of the family income supplement scheme. It is very cumbersome and complicated and the volume of uncollected payments year after year indicate clearly that there is a lack of awareness and understanding of how the scheme works. Last year we endeavoured on Committee Stage to extend the scheme to small farmers, many of whom are in receipt of unemployment assistance and whose incomes were eroded severely over the past number of years, especially with the introduction of milk quotas, levies and super levies. The amount of money required to extend FIS to small farmers in receipt of assistance would not put an enormous burden on the Exchequer.

If the Minister could find a mechanism to simplify that scheme it would be welcomed and there would be a greater uptake. A sizeable amount of money was not drawn down for a number of years and, at the same time, research indicated that a sizeable number of people are entitled to claim it. This lack of take up may be due to the cumbersome way the FIS is calculated. I cannot advise the Minister how to adjust it but I am sure he has his own ideas. Would it be better to redirect the FIS budget?

I support Senator Cregan's views on the desirability of supporting the family. This is a family Bill and all the indications are that this money is being directed in the proper way but FIS should be examined. The Minister should undertake to provide a report to the Houses on the operation and impact of the FIS scheme. Research undertaken on small farmers' assistance in the early days showed that the bulk of the money was put back into production. A research project in my constituency indicated clearly that there was a substantial increase in production in the areas which were receiving that assistance; this indicated that the money was being invested in improvements to the farms. There is no comparable report on the impact the FIS has on economic circumstances of the families involved. Perhaps some work should be done there by the Combat Poverty Agency or other groups.

In relation to family income support, education needs to be carefully looked at by the Minister, perhaps in consultation with the Minister for Education. Everyone recognises the link between a lack of educational qualifications and the difficulty of getting employment. Many families in the lower income group and people depending on welfare payments of one kind or another find it extremely difficult to keep their children at school or college. This problem is particularly acute in rural areas because of the added burden of travel and subsistence expenses for those who must leave home to attend college. While the situation may be deteriorating in the cities, in rural areas one now finds a far greater percentage of children from less well off sections of the community and people dependent on unemployment assistance benefits or welfare disabilities going on to second and third level education.

At the weekend I spoke to a woman who is on unemployment assistance, as is her husband. They have two children attending the University of Limerick. The cost of keeping children in an exceedingly expensive university city such as Limerick is an extraordinary burden to carry. The remainder of the family are suffering severely as their lifestyles are curtailed. The Minister could do something in such a case through voluntary schemes. I am not saying it is necessary to introduce a broad and expensive multi-million pound scheme, but he might look at the initial voluntary fund which is doing an excellent job having started off from small beginnings. Hundreds of voluntary organisations have been assisted around the country providing excellent services and facilities for people who are in need. If some attention was given to how family education support might be built into the welfare system it would alleviate some of the long-term problems the Minister has with more and more people with less education coming onto the unemployment list.

I compliment the work that has been done by welfare officers working on this new initiative which has taken off in the past few years. They identified people in areas of unemployment and deprivation, supported them and helped them to get out of the unemployment trap into meaningful employment. This is a welcome development which I would like to see expanded and developed further.

The Minister said the Bill would be a further effort to make the system more equitable. It is probably going along those lines, although I would like to see more fundamental investment in this area. Any Minister will have the problem of trying to convince colleagues in Government of the necessity for sizeable investment in this area if we are to do a meaningful and positive job. In the short time that is available to the Minister, perhaps he could introduce some new dynamics into the areas I have mentioned, including the link between health and unemployment problems, education and unemployment, and deprivation and small incomes. He might also look at bringing closer into this system the voluntary organisations that have been helping out greatly.

I wish to compliment Fr. Seán Healy's organisation on the valuable work it is doing. It has made positive criticism, which is welcome in this area, of other Ministers. The Bill is useful in so far as it goes. It could go a lot further but we will take it as it is. It is welcome and we support it.

There is a ritualistic and almost tribal tradition in the Houses of the Oireachtas that when speaking on a Bill such as the Social Welfare Bill or the Finance Bill in any year but particularly in an election year, Government Deputies and Senators welcome the Bills while Opposition Members acknowledge that they are good in spots, like the proverbial curate's egg, but overall they lack vision and a strategic approach.

As a first term Members of Seanad Éireann it would be a bit impertinent of me to fly in the face of that tradition. I do not intend to but I sincerely hope that in this debate we shall give credit to the Minister where credit is due and provide a constructive input on every aspect of the Bill.

I genuinely believe that the Minister, in formulating this Bill which, among other things, gives legislative effect to the social welfare provisions of the budget and to certain aspects of the Partnership 2000 agreement, has been innovative, thoughtful and caring. I congratulate him on the social progress he has incorporated in the Bill. Certain steps have been taken in the Bill which any sensible public representative must applaud.

The social welfare payment increases in the Bill are between 4 per cent and 4.8 per cent, which is approximately twice the expected rate of inflation for this year. Most recipients of social insurance and social assistance payments are now at or very close to the minimum rates recommended by the Commission on Social Welfare. To any representative who puts people before politics that must be a landmark development which we should all welcome. I would have liked more generous increases in the rates of social welfare payments. I am sure that every Members of this House would join with me in that and I am sure the Minister would fully share and, indeed, lead us in that aspiration. The Minister and the Government have, however, to achieve a balance in relation to the varying demands on them. In my view they have struck a very good balance in this Bill.

A further aspect which I warmly welcome is the increase in child benefit. This is particularly targeted at supporting families and is largely relied on by mothers. The Minister and this Government can validly claim credit for transforming the child benefit system in a strategic approach to reforming income support for children. In the past three years child benefit has increased by 52 per cent for a three child family and slightly more for a four child family. In 1991, a four child family received approximately £70 a month. This year it will increase to £138, virtually double the amount in 1991. The Minister has worked hard and effectively at greatly improving such payments to mothers of young children. I have little doubt that the transformation in this area is fully appreciated by people throughout the country.

I regard the sickness allowance being introduced by the Minister as an important innovation. We have all come across cases over a number of years where people who were ill did not qualify for either disability allowance or disability benefit because they did not satisfy the contribution conditions. Such persons had, in the past, to resort to supplementary welfare allowance, paid through the health boards, which was never intended as a sickness payment. The sickness allowance will be paid at the same rate as unemployment assistance, both short and long-term. The introduction of this allowance fills a void in our social support system and its introduction will be widely welcomed.

Another innovative feature of the Bill, and arguably its most important provision, is the introduction of the pro rata contributory pension. Under this provision in section 12 reduced rate old age contributory pensions will be payable to persons who have a yearly average of between ten and 19 contributions over the period from when they first became insured until they reach the age of 66 years. This pension will have a particular applicability and attractiveness to married women who return to the workforce having reared a family; to returned emigrants whose work period abroad cannot be reckoned for pension purposes in Ireland; and to certain categories of self-employed people.

Over the years many public representatives have pressed for a change in this aspect of our social welfare and the Minister is to be congratulated on making this significant advance. It is to be welcomed not just as a progressive social measure but also as a matter of justice. If people make significant contributions to the social insurance fund, even if they are not continuous, they should expect a return from them, particularly in their later years. This innovation responds to that requirement.

It is heartening to see progressive social measures being introduced in this Bill. The Minister will be regarded in the future as an innovative, caring and effective holder of a difficult portfolio. This is a time of progressive social developments in our country. Our economy is going through a period of unprecedented prosperity. We have been assured over the years that the rising tide will lift all boats. However, that will not happen without intervention. The prosperity does not trickle down unless someone makes it happen.

Poor and disadvantaged people in our society have had to wait a long time for some of the developments incorporated in this Bill. For example, the Minister is introducing a new non-contributory pension scheme for widowers which is a long overdue aspect of equality legislation. He is extending entitlement to disability allowance to persons who reside in an institution on a part-time basis or at home, as recommended in the recent report of the Commission on the Status of People with Disabilities. It is sometimes claimed that the work of such commissions is a pretext for doing nothing. However, with good government they can act as a guide to effective action.

The carer's allowance, which the Minister inherited, is also a successful measure. Any Government which claims to have a monopoly on innovation and intelligence, even if it is made in an election year, is flying in the face of history and reality. This Bill greatly improves the carer's allowance. It relaxes the conditions on people requiring full-time care so that the person caring for them will get the carer's allowance even if the incapacitated person is attending rehabilitation training or day care centres on a limited basis. That is a practical and imaginative approach to the problems of people whom the rest of society should support.

I have received representations from a number of groups which are faced with special problems as a result of current administrative practices. Separated persons in receipt of maintenance payments, for example, are barred from participating in various FÁS schemes, such as the SES, because of administrative decisions. I ask the Minister to review this approach so that these groups are given an equal opportunity to participate in such FÁS schemes.

I have also had representations from the INOU in relation to section 30(4)(b). The INOU wants this subsection, which deals with the regulations specifying the circumstances in which a person is or is not regarded as being available for or genuinely seeking employment, deleted. This is a highly technical matter with which I and other Senators may not be able to deal. I presume the subsection was drafted in response to the Department's experience in this regard. I would be grateful if the Minister referred to the concerns expressed by the INOU in his reply.

I indicated at the beginning of my speech that I would take the predictable stance of a Government Senator in support of this Bill. However, even by objective standards it will be regarded as a progressive and reforming Bill which has made pioneering and worthwhile improvements to our social legislation. It is vital that we protect the most vulnerable groups in our society and that there is social cohesion and solidarity across the generations and income groups. I congratulate the Minister and the Government for taking important steps in that direction and I am proud to support these measures.

Not only does this Bill mean a lot to the people who will benefit from its provisions, but it also shows that social welfare has a more meaningful role than it had in the past. It is important to win people's confidence in that regard. We seemed to be going in the wrong direction for a while as people believed it was right to be on social welfare.

The Social Welfare Bill is often seen as routine legislation which gives effect to the budget. Its effects, however, will be felt by thousands of households who depend on the social welfare system to maintain and improve their quality of life. Social welfare is not simply about providing assistance to people in times of need. It encompasses a comprehensive social insurance system which is under assault from certain political elements but which Democratic Left is determined to maintain and enhance.

I welcome the provisions for pro rata pensions which will enable many people with atypical employment histories to benefit from the social insurance system. As well as a general increase in social welfare rates, the Bill targets families for particular assistance. Child benefit is being increased, bringing the total increase to over 50 per cent in the past three years. Provisions is also made for a substantial increase in the carer's allowance.

Evidence shows that families, particularly large families, are most likely to live in poverty. Democratic Left and this Government have made a conscious decisions to target poverty by targeting those most at risk from it. That decision has not always been popular. Some people believe that social welfare improvements should be implemented in a scatter-gun fashion. However, effectiveness rather than popularity should be the test of good government. The family friendly thrust of this Government's social welfare policies will be felt long after its critics have been reduced to historical footnotes.

The fundamental cause of poverty is unemployment and low paid work. The measures presented in the budget and given statutory effect in this Bill are designed to make the transition from dole to work easier and to alleviate the circumstances of those in low paid work. Measures ranging from the change in the way adult dependant allowance is assessed to the improvements in family income supplement are designed to encourage people to take up employment and, in the case of family income supplement, to improve the standard of living for those on low pay. These measures are necessary and welcome.

Low pay, however, cannot be addressed in the long term by subsidising low wage employers through initiatives such as family income supplement. Democratic Left has long argued that the current sectoral minimum wage agreements should be extended to include all sectors where low pay is a problem, with the eventual aim of moving towards a general minimum wage. Approximately £23 million has been paid in family income supplement. We should examine why workers in some statutory bodies qualify for family income supplement. If a person does not qualify for disability benefit, although they have a medical certificate, they must go to a community welfare officer. However, these officers do not make uniform decisions. Consequently, I wish that uniformity be built in. Will a medical certificate be required before a person qualifies for the sickness allowance?

Two thousand people could benefit from the carer's allowance. People are very interested in it and I welcome it. I promote it as much as I can in my local area. While one must be clinical in his or her appraisal of any issue, one must be sympathetic in his or her approach and decision on this matter. Sometimes a person caring for an individual may not be residing in the same house but could be living nearby. This care and attention means the individuals involved can stay in their own homes. However, very often an individual cannot be looked after at home and in some instances are handed application forms for private nursing home subvention and subsequently admitted. They find their home is taken into consideration when applying and their savings are gone before any decision is made to provide the subvention. That needs to be looked at as I am sure the Minister is aware of the percentage of the population that is aging. In some instances relatives claim for parents. That did not happen years ago but it is a sign of the times and must be taken into account.

Will the Minister clarify the liability to maintain family under section 29? Single parents qualify for benefit, but the other half is not far away. Is that person liable to provide maintenance? If not, it should be provided. Reference was made to a person who must prove he or she is available for and genuinely seeking employment. The section concerned is archaic, but under its regulations there will be more flexibility in its interpretation. There is a doubt in people's minds as to how it will be applied. They feel it could be used against them.

I refer to decisions on late claims. Cases occur where an individual in receipt of a widow's pension suddenly realises after a number of years she is over the pension age. She is told she is entitled to a pension in her own right because she has the necessary qualifications, yet she is restricted for six months. I welcome the increase. No matter how clinical one is in his or her appraisal of the situation, one should be sympathetic.

Why is it necessary to refer to the Circuit Court? Social welfare appeals officers are always very amenable to medical representations where individuals apply for disability benefit or the sickness allowance. Referral to the Circuit Court should not be encouraged. I welcome the Bill and the Government will be returned to office to implement its provisions.

I welcome the Bill. I have a query which was brought to my attention by Mrs. Devaney from Castlebar. Where two people draw contributory pensions and one dies, the other person is not entitled to the six weeks pension. I would welcome a change in the law in regard to this. I will raise it again on Committee Stage and ask the Minister to give it consideration in the meantime. I have no doubt, as Senator Sherlock said, that this Government will be returned to implement the many attractive aspects of the Bill.

Is the election that soon or is it in October?

I thank Senators who made contributions. All points made have been noted and will be considered. I welcome those who have recognised the Bill as innovative and one which attempts to move the social welfare system into a new era.

I take with a grain of salt Members of the Opposition who on the one hand argue that not enough is being spent on social welfare and at the same time support the Progressive Democrats which calls for the abolition of the social insurance system.

They support us. The Minister should not attack them in their absence.

I am attacking Fianna Fáil for supporting them in seeking the abolition of the social insurance system which accounts for £2 million in revenue to the Department of Social Welfare. They cannot on the one hand argue for greater expenditure on social welfare and at the same time argue for the abolition of 50 per cent of its income.

Do not blame us for Progressive Democrats policy.

I ask for some common sense from the Opposition benches in regard to social welfare and the innovation it requires. There is no doubt that payments to social welfare recipients are inadequate. I am on record in this House as a member of the Opposition and Government that we need to do a great deal more in regard to the rate of payments to people whose sole income is from social welfare payments. If we want more expenditure, we must find the money to pay for it. We will not find that by abolishing the social insurance system as proposed by the Progressive Democrats.

In relation to innovation, in the next couple of weeks we are publishing a Green Paper on the voluntary sector and its relationship with the statutory sector. We have developed, and are on the point of approving, a national anti-poverty strategy, which is the first time a Government has addressed the question of poverty in a strategic way.

We have introduced in this Bill new and improved pro rata pensions which will solve considerable problems for many people who have very large gaps in their social insurance contributions. It will also solve some, although not all, problems for people on fairly low occupational pensions who have made mixed insurance contributions over the years, such as CIÉ workers who have been caught in that trap. We are introducing reform in regard to late claims and a new sickness allowance. We have made significant improvements in what was formerly known as the disabled person's maintenance allowance and which is now referred to as the disability allowance.

We have introduced a new one parent family payment which gives significant incentives to single parents to enter the labour market. This is available to every one parent family which needs support, regardless of whether they are separated, deserted, divorced or unmarried parents and whether they are men or women, which is a significant development. We have completed the process of equality in the social welfare system. There is no scheme in the Department of Social Welfare which discriminates between men and women on the basis of gender.

We have increased child benefit by an average of 50 per cent in the last three budgets. It is important to bear in mind that that is a strategic policy decision. It is not simply a question of locating some money and seeing into what it can be put; it is put into child benefit for very real, policy based reasons. All the research indicates that families with children are at a greater risk of poverty and families with large numbers of children are at the greatest risk. That is why we have given significant increases to families with three and more children.

We will continue to develop that child benefit approach. That is directly linked to one of the criticisms which was made of child dependant allowance, which is paid in tandem with an adult allowance to a person on social welfare who has a child under a certain age. It is recognised by all researchers that child dependent allowances are a very real disincentive to the unemployed to take up work. In the last three budgets we have frozen the child dependent allowance, for which we make no apologies, and loaded all the increases for children into the child benefit system. That is the best way of doing it.

Child benefit is not taxed and is not withdrawn from those on differential rents or if one is means tested for any scheme under the Department of Social Welfare, health boards or any other Department. It is a payment which every parent with a dependant child receives regardless of their income, which has led to some criticism. However, a point that is missed is that less than 7 per cent of child benefit goes to families with incomes in excess of £25,000 a year. There is a very good reason for that statistical reality — when the vast majority of people move into the higher levels of income their children are already reared. Child benefit is one of the most important schemes and benefit every child, regardless of their class, where they live or whether they have good or bad parents. A million children and 500,000 households receive child benefit.

A question was asked about what could be done for the long-term unemployed, particularly men. That is somewhat ironic because when I was first elected to the other House in 1982 one would have been laughed out of the House if one had complained about discrimination against men as the discrimination was all against women at that stage. There is a growing perception that certain categories of men are not being treated fairly under the social welfare system. To some extent that derives from the fact that the Department of Social Welfare, in constructing certain schemes, targets particular categories of people for assistance, of which child benefit is an obvious example where payment is made for a child regardless of the income of the household. It could be argued on equity grounds whether that money is well spent; I argue it is.

Family income supplement could also be described as discriminatory because it only goes to people who work and have children to support. We are currently paying in the region of 13,000 people who are working and supporting children £25 million under the family income supplement scheme. Questions have been asked about family income supplement, whether it is working effectively and if enough people know about it, about which a number of points need to be made.

In a public survey carried out by the MRBI on behalf of my Department last year it was found that 76 per cent of people are aware of the family income supplement, which is a fairly high level of awareness. It is clear there must be other reasons for eligible people not claiming that allowance. We do not know what those reasons are but there is a range of theories on it.

I know people who have taken jobs and will not apply for family income supplement, for which they are eligible, because they do not want to be in receipt of a social welfare payment. They feel that because they are now working they should be finished with social welfare payments. There is a range of other attitudes which need to be examined to identify whether we can improve the take-up rate of that allowance.

There is also a reverse psychology involved. I am not suggesting this is widespread, but I know of cases where employers use the family income supplement as a means of depressing wages. An employee might be reluctant to apply for FIS, which must be stamped by the employer, because they might not get the raise they are due in six or 12 months' time.

There is a range of issues relating to family income supplement which must be addressed. However, there is a commitment in Partnership 2000 that we will convert assessment for family income supplement on a net basis, in other words, the income which will be taken into account will be the income after tax, levies and PRSI have been deducted. At the moment, it is calculated on the basis of gross income, although we introduced a disregard for PRSI and levies this year.

The changes we have made to unemployment assistance for part-time workers is of benefit to men and women without discrimination. The retention of the child dependant allowance for 13 weeks after a person takes up employment is available to men and women without discrimination. The back to work allowance scheme, where a person can retain 75 per cent of their unemployment assistance on a reducing basis to 25 per cent over three years, is available to men and women. FÁS training is also available and we provide support for child care through various schemes.

The back to work allowance scheme, one of the most successful re-employment schemes introduced by the former Minister for Social Welfare, Deputy Woods, is simple to operate and understand and has enabled 17,000 to come off the live register and into work. We are expanding the numbers to 22,000 this year and — a unique innovation — are setting aside 1,000 of those places on a pilot basis for people with disabilities who are on disability allowance. They would not have been entitled to do this in previous years because they were not on the live register.

We have taken on board the representations made regarding late claims and have extended the scheme from six to 12 months. We are also incorporating into the legislation regulations which allowed flexibility regarding late claims, together with a ministerial prerogative which could have been used or abused by any Minister, although I am sure that never happened. It will now be a prerogative for officials appointed by the Minister to ensure that any decisions made will be above board.

We are providing that the chief appeals officer can refer an appeal to the Circuit Court in certain cases to deal with situations referred to us by the Criminal Assets Bureau. Circumstances have arisen where we have allocated deciding officers to the Criminal Assets Bureau. They have certain protections under legislation, given the nature of the work they are dealing with. We have made this provision because there may be cases where the appeals officer would not be in a position to decide a case due to the risk of threat or intimidation. It is an unfortunate reality; nevertheless, I do not expect it will be used widely. Arrangements are being made to ensure that the procedures are simple and straightforward in the Circuit Court and it will not be clogged up with such cases.

The INOU requested that the section dealing with regulations regarding availability for work should be dropped. This is not acceptable. There is a two way contract involved in unemployment assistance. Those making social insurance contributions insure themselves against unemployment, sickness, maternity, old age, orphans, widowhood, etc. Certain conditions apply to these schemes — for example, a claimant for widow's pension must prove that her spouse died and a claimant for an unemployment payment must prove that he or she is unemployed. Employers and employees make contributions to the social insurance scheme; but where the contributions are not adequate the State, through the taxpayer, makes a contribution to those who are unemployed in the form of unemployment assistance.

We have an obligation, as does the recipient, to ensure that only those entitled receive payment. That is why we are looking at the question of availability for work. The right to receive an unemployment payment is balanced by the concomitant responsibility to seek work if one is fit for work and to take up training or available work that is suitable to one's talents, abilities, etc. It does not have to be any kind of work; it has to be available within reasonable proximity of one's home. While we do not expect people living in south Kerry to travel to north Donegal to find work, there are criteria that must be complied with to qualify for unemployment assistance or benefit.

We are taking this power in the Bill to look again at the question of availability for work. The INOU is concerned that this will become a way of denying unemployment assistance to those entitled to it. That is not the case. I have already undertaken to consult with the INOU before the regulations are finalised in an attempt to ensure that they will not present it with problems.

Approximately 8,000 people are in receipt of a carers allowance. It has been suggested that we undertake a review of the allowance and the needs of carers, etc. In tandem with the Department of Health, I undertook such a review, which revealed that one in four carers currently in receipt of the allowance care for more than one person. That is why we have introduced a 50 per cent increase for people in that category.

As in all schemes, a fixed amount of funding raises questions of priorities — for example, are more people to be included, is more to be provided to those already covered, or is combination of both approaches to be adopted? In the past number of years, I have increased the amount of money that a cared for person may have while still qualifying for the carers allowance, provided a companion pass for the carer, a substantial £5 increase last year on the carers allowance and maintained such an increase this year. I have also introduced the 50 per cent bonus this year for those who care for more than one person and have eased to some extent the criteria for full-time care where a person is training on a temporary basis.

As in other areas, I am conscious of the fact that many more than 8,000 people care full-time for relatives in the home. It is estimated that approximately 30,000 people care on a full-time basis. Depending on how one counts them, some organisations argue that the figure is closer to 100,000. If we are to fund a scheme that will provide an income for such numbers we must look seriously at how we will find the funds. Senator Sherlock's suggestion, that we vary the requirement that the person providing the care live in-house, is attractive. In my own constituency, for example, a daughter caring for her parent living in the house next to her does not qualify.

There are circumstances where sons or daughters are living in cottages on small farms and their parents are living in even older cottages on the same land but they do not qualify. The problem is this. If there is a certain amount of money available, should the scheme be expanded to include people in those circumstances or extended in another way? Choices must be made in terms of the most urgent need. This year the most urgent need was to assist those who are caring for more than one person. That is the judgment I made and I stand by it. However, this does not mean the reforms suggested by Senator Sherlock and others should not be implemented.

I would welcome a debate on my suggestion that a carers' benefit which would not be means tested should be considered. At current levels this would cost approximately £50 million a year, an increase of approximately 0.5 per cent in PRSI. This is the choice we must make. Do we want to provide that type of benefit and pay for it through PRSI or another way? The issue of carers must be addressed not only in terms of giving them a basic rate of income similar to unemployment assistance but also in terms of a rate for the job.

Respite care must also be considered. A person cannot give care for 18 hours a day, seven days a week, 52 weeks a year without a break. They will die before the person for whom they are caring. Other aspects which must be examined are nursing back up, transport and other services. This major issue must be addressed because Ireland is an ageing society and people are living longer. It will not become a major problem in the foreseeable future but it is growing and needs to be addressed. If the current Government, as I expect, returns to office by the end of this year, I will promote this issue.

The review of the carers' allowance carried out by my Department and the Department of Health found there would be little difference between the cost of what carers should receive in terms of back up services compared to the cost of institutional care. However, the quality of care, in terms of the responsiveness of the person who is being cared for, is much better when they are cared for at home rather than in an institution. I do not suggest the quality of care in institutions is not good but it is a different type of care.

There will always be a need for institutional care because some people are so ill and disabled that they cannot be cared for at home. It is not humanly possible for a son or a daughter or a husband or wife to care for such people at home. It is a question of getting the balance right between providing the best possible quality of care and ensuring that the service of those who provide care is recognised. I would not mind if Fianna Fáil, the Progressive Democrats, Fine Gael or the Labour Party robbed my idea of a carers' benefit and made it their policy in the next election. They would have my full support in that regard. I thank Senators for their contributions.

Question put and agreed to.
Agreed to take remaining Stages today.