This is the second of two Bills to implement the social welfare package of €900 million announced in last December's budget. This generous package brings total expenditure on social welfare in 2008 to just under €17 billion and represents nearly half of all additional current Government spending announced in last December's budget.
The Social Welfare and Pensions Bill provides for the implementation of certain social welfare improvements announced in the budget for 2008. It also contains the statutory basis for the administration of the blind welfare allowance and the domiciliary care allowance by the Department of Social and Family Affairs. These schemes are currently administered by the Department of Health and Children and their transfer is part of the Government's health service reform programme. The Bill also provides for miscellaneous amendments to the Social Welfare Consolidation Act 2005, the Pensions Act 1990, and consequential amendments to the Family Law Act 1995 and the Family Law (Divorce) Act 1996.
The social welfare budget package provides approximately €148 million, or €194 million when the early child care supplement is included, to improve the range of supports provided for children. The 2008 budget provided increases of 6% or above in overall child income support through a combination of child benefit, qualified child increases, the back to school clothing and footwear allowance and the early child care supplement.
The policy direction followed by successive Governments in recent years has included the dedication of substantial resources to the universal child benefit scheme. This represents part of an ongoing objective of reforming income support for children to reduce work disincentives by making child income support more neutral vis-à-vis the employment status of the parent. The policy focus has been driven in part by the recognition that the loss of qualified child increases by social welfare recipients on taking up employment could act as a disincentive to taking up available work opportunities.
The introduction of the national minimum wage in 2000, together with improvements in the in-work family income supplement, FIS, scheme, including the re-focusing of the supplement's income thresholds on larger families from January 2006, have reduced further the impact of the loss of qualified child increases in the decision to take up full-time employment. In view of these changed circumstances, qualified child increase rates were increased somewhat in 2007 and 2008, the first such increases since 1994.
The agreed programme for Government also contains a series of welfare reforms aimed at prioritising the interests of families and children. Under the terms of an earlier social partnership agreement, the National Economic and Social Council, NESC, was requested to examine the feasibility of merging the family income supplement with qualified child increases to create a single second tier child income support. Such a payment would be aimed specifically at targeting child poverty by channelling resources to low-income families without creating significant disincentives to employment. The commitment to examining such a change was embodied in subsequent social partnership agreements, including Towards 2016.
The NESC decided not to adopt a definitive position on the issue and has instead recently published a paper in its research series setting down the complex policy and technical challenges involved. The paper will be of help in informing further developments in this area. The importance of targeted income support to families and children continues to be a high priority for the Government and recent changes have seen substantial improvements in this area.
The 2008 budget provided for payment of an additional €2 per week in the qualified child increase, formerly called the child dependant allowance, which is paid to all social welfare recipients with children. It also provided for increased weekly income thresholds for all FIS family sizes, with additional resources being directed at larger families as research has shown that is where poverty is more likely to exist. These improvements will benefit some 26,500 existing families and entitle a further 2,700 families to the payment.
These changes represent a more selective approach to child income support through targeting children in poorer households while limiting the extent to which employment disincentives are increased. Maintaining this balance will remain a priority in consideration of future policy changes in this area.
I am also pleased to continue the policy of increasing child benefit this year. The Bill provides for an increase of €6 in the lower monthly rate of child benefit and €8 in the higher rate, bringing the new monthly rates to €166 for each of the first two children and to €203 for the third and subsequent children. The increase in child benefit will be effective from April 2008 and will benefit more that 570,000 families in respect of approximately 1.1 million children.
The Bill, on behalf of the Minister of State at the Department of Health and Children with responsibility for children, also provides for an increase of €100 in the annual rate of the early child care supplement, bringing the annual rate to €1,100 and the quarterly rate to €275. This increase will apply from the first quarter of 2008 and will benefit up to 430,000 children by the end of 2008.
The Government discussion paper, Proposals for Supporting Lone Parents, recommended expansion of the availability and range of education and training opportunities for lone parents, an extension of the national employment action plan, to focus on lone parents and the introduction of a new social assistance payment for low-income families with young children.
Recognising the high levels of consistent poverty among lone-parent families, the report also recommended the upper income limit for the receipt of the new social assistance payment should be €400 per week. The 2007 budget realised this increase and I am happy to go further in this Bill by increasing the upper earnings limit for qualification for the one parent family payment to €425.
The EU survey of income and living conditions statistics for 2006 suggests there is still some way to go in alleviating the risk of poverty faced by many lone parents. I am still convinced the long-term aim of the proposed new social assistance payment, to help people to achieve financial independence by supporting them into training and education and enabling them to enter the labour force, offers the best way out of poverty and social exclusion. The development of any new scheme to support low-income parents can only be introduced when the necessary co-ordinated supports and services are put in place on the ground by other Departments and agencies.
That is why the non-income recommendations contained in the discussion paper are being tested in two areas, Coolock and Kilkenny. These tests are focused on identifying and resolving any practical and administrative issues which may arise in advance of the scheme being introduced. The tests are nearing completion and a report will be made to the Cabinet committee on social inclusion. The tests will allow for operational and logistical co-ordination between the relevant Departments and agencies to be considered and will facilitate the development of the policy and operational details of the new social assistance scheme and accompanying supports.
As we all know, carers play a critical and much-valued role in ensuring that older people and those with disabilities can remain in their own homes for as long as possible. Supporting and recognising carers in our society has been a priority of the Government since 1997. I assure Senators that we are committed to supporting care in the community to the maximum possible extent. This commitment to carers has been reinforced in the national partnership agreement, Towards 2016, and in the programme for Government, both of which include significant commitments in the area of caring. These include commitments to increase the amount of the respite care grant, to keep the further development of payments to carers under review and to ensure that those on average industrial earnings can continue to qualify for carer's allowance. The Bill provides for an increase of €200 in the respite care grant, bringing the value of the grant to €1,700 for each care recipient. This measure will benefit more than 48,000 carers this year. The increase in the respite care grant will take effect from June 2008.
The primary objective of the social welfare system is to provide income support. As a general rule only one weekly social welfare payment is payable to an individual. Persons qualifying for two social welfare payments receive the higher payment to which they are entitled. This has been a cause of particular concern to people in receipt of a social welfare payment when they become carers. As Senators know, budget 2007 provided for a fundamental reform of the social welfare system for carers in this regard. Under the new arrangements, which came into effect in September 2007, people in receipt of certain social welfare payments other than carer's allowance or benefit who are providing others with full-time care and attention can now retain their main payment and receive another payment, depending on their means, the maximum of which is equivalent to a half-rate carer's allowance.
These new arrangements apply to almost all weekly social welfare payments and to people in receipt of qualified adult allowances. The beneficiaries are people currently in receipt of carer's allowance who may have an underlying eligibility for another social welfare payment, such as a contributory State pension, and people currently in receipt of other social welfare payments who are also providing full-time care and attention. These may now qualify for an additional payment. To date, almost 7,000 additional carers have benefited from these new arrangements.
One of the Government's key commitments is to the development of a national carers' strategy. This strategy will focus on supporting informal and family carers in the community. While social welfare supports for carers will clearly be a key aspect of the strategy, other issues, such as access to respite care and other services, education, training and employment, will also feature strongly. Co-operation between relevant Departments and agencies is essential if the provision of services, supports and entitlements for carers is to be fully addressed. For this reason, all relevant Departments and agencies are involved in the strategy and there will be appropriate consultation with the social partners. An interdepartmental working group has been established to draw up the strategy. The group is chaired by the Department of the Taoiseach, with the secretariat provided by the Department of Social and Family Affairs, and includes officials from the Departments of Finance, Enterprise, Trade and Employment, and Health and Children as well as the HSE and FÁS. The expertise of other Departments and agencies will be called on as required. It is expected that the strategy will be completed by mid-year.
The recent improvements in the income supports available from the Department, together with the improvements in home care and related services provided by the Minister for Health and Children in recent budgets, represent a further realisation of our vision of a co-ordinated approach to services and supports for carers in the community. The development of a national carers' strategy provides us with an opportunity to build further on these improvements and to consider other areas in which progress can be made.
I wish to clarify the position on young carers, which was raised during the earlier debate on this Bill in the Dáil. Towards 2016 commits the Government to carrying out a study of children who have undertaken inappropriate care roles in order to establish the extent of the problem and the impact on the lives of the children concerned. The agreement also states, "Based on the outcome of this study and an analysis of the issues identified, a programme of in-home supports will be developed to alleviate specific problem areas identified for children". The Office of the Minister of State with responsibility for children intends to commission such a study this year, following consultation with the relevant Departments and agencies. Although my Department does not have the lead role in this study, my officials will be involved as appropriate.
The transfer of the administration of blind welfare allowance and domiciliary care allowance to the Department of Social and Family Affairs will be of benefit to both the HSE and the Department. The transfer will allow the HSE to concentrate on its core health functions and, in particular, on other aspects of its reform programme. From my Department's point of view, the transfer will provide opportunities for enhanced customer service and more effective and co-ordinated administration of income support payments. The Bill provides a framework for eligibility and a set of clear and detailed guidelines which will apply to the administration of domiciliary care allowance and blind welfare allowance. Accordingly, mainstream income support eligibility and assessment criteria will be applied. Most recipients of domiciliary care allowance and blind welfare allowance are also in receipt of child benefit or another social welfare payment and are therefore already customers of the Department of Social and Family Affairs. The transfer will make it easier for my Department to increase awareness of its services and give information on access and entitlements to all its payments. The transfer will in effect mean that a person's income needs will be dealt with in one Department.
It has been decided that both payments will transfer on an as-is basis in the first instance. This is to ensure that the transfer runs as smoothly as possible and without any disruption in service to recipients. This approach will also ensure that any necessary linkages between income support and health systems are preserved. The transfer will be achieved with appropriate adjustments in manpower in the Department of Social and Family Affairs and the health sector, and will be neutral in terms of Exchequer funds and staff numbers. The Bill proposes to remove the existing means test for domiciliary care allowance, which is applied solely to the income of the child. I did not feel it was appropriate to include this part of the existing scheme in the proposed legislation. On transfer of domiciliary care allowance this means test will no longer be applied. The transfer of these payments within mainstream income support legislation is an appropriate development and will provide a more streamlined, consistent, and efficient customer-oriented service to recipients of domiciliary care allowance and blind welfare allowance.
The House will be aware that the Green Paper on Pensions was launched in October 2007 following an intensive review of the pension system by several Departments and the Pensions Board. Publication of the Green Paper was a Towards 2016 commitment. The document comprehensively addresses issues relating to social welfare and supplementary pensions in Ireland. The Green Paper does not recommend any particular course of action but rather sets out the challenges facing our pension system now and in the future. It clearly sets out the current situation and the implications, from an economic and social perspective, of various suggested courses of action.
Views are being sought on the issues raised in the Green Paper through a consultation process which has been taking place since its publication. This process is being facilitated through the website www.pensionsgreenpaper.ie, where people can make submissions and express their views on the important issues raised in the Green Paper. It also provides information on the Green Paper and on events relevant to the consultation process. I am happy to inform Senators that approximately 80 submissions have been made through the website to date. Interested parties can also make submissions directly to my Department and I encourage all Senators to use this consultation process as an opportunity to express their views on this important matter.
The Department also organised a number of regional seminars during the last week of February and the first week of March, the first of which took place last week in Dublin. Further seminars took place in Waterford on Monday and in Cork yesterday, and today there is a seminar in Tullamore. The final regional seminar will take place tomorrow in Sligo. These seminars will be followed by a major conference in Dublin in May. This extensive consultation process will ensure that all those who wish to contribute to the debate are given an opportunity to do so. The consultation process will provide an important and valued contribution to the development of a framework for comprehensively addressing the issue of pensions over the longer term. The Government plans to have completed this framework by the end of 2008.
I will now outline the main provisions of the Bill, which includes new measures and amends the Social Welfare Consolidation Act 2005, the Pensions Act 1990, and a small number of other Acts. Sections 1 and 2 provide for the Short Title, construction, collective citation and commencement of the Bill and contain definitions of certain terms as they apply throughout the Bill.
Section 3 provides for an increase of €6 in the lower monthly rate of child benefit and €8 in the higher rate, bringing them respectively to €166 and €203 per month. The increase in child benefit will be effective from April 2008. Families who receive the monthly payment via their bank accounts will receive the budget increase from April 2008, while those who receive payment via personalised payable order books encashable at post offices will be paid, as has been the case in previous years, in the first week in May 2008, backdated to April 2008.
Section 4 provides for an increase of €100 in the annual rate of early child care supplement, bringing the annual rate to €1,100 and the quarterly rate to €275. The increases will apply from the first quarter of 2008.
Section 5 provides for the implementation of Council regulation 259/68 to allow an official employed in a European Communities institution to transfer the actuarial value of their pension rights from the social insurance fund into the pension scheme of the European Communities institution, PSEC, and for the transfer of the actuarial value of their pension from the PSEC to the national system. Currently a person employed by an EC institution is not covered by the protection that normally applies to EU citizens under EU regulation 1408/71 which ensures that other member states take account of PRSI contributions paid in Ireland. This section makes provision to enable the transfer of any such contributions from the social insurance fund to the PSEC. It also provides for the transfer of contributions from the PSEC to the social insurance fund.
Section 6 provides that a person transferring back to illness benefit from invalidity pension will be entitled to a full personal rate of illness benefit where they have the required number of contributions in the relevant tax year. Section 7 provides that a person moving from disability allowance to the non-contributory State pension at age 66 will not receive a lower rate of payment owing to a less favourable capital disregard on the non-contributory State pension scheme.
Section 8 raises the earnings limit for receipt of one-parent family payment to €425, as announced in the budget for 2008. It also provides for the income to be assessed in a manner to be prescribed by regulations. These will provide for the disregard of social insurance, health and superannuation contributions and trade union subscriptions for the purposes of assessment of earnings for one-parent family payment. Section 9 increases the respite care grant to €1,700 as announced in the budget for 2008. The increase will apply from 5 June 2008.
Section 10 provides for the deletion of the outdated term "penal servitude". It also provides that a person shall not be considered to be detained in legal custody for the purposes of entitlement to disability allowance when he or she is detained for treatment under an admission order or renewal order made under the Mental Health Act 2001, under section 38 of the Health Act 1947 under sections 4 or 5 of the Criminal Law (Insanity) Act 2006, under section 17 of the Lunacy (Ireland) Act 1821 or under section 2 of the Trial of Lunatics Act 1883, and that these provisions which are beneficial to the individuals affected will be deemed to have come into effect on 1 June 2005.
Section 11 provides that a home maker may include a person who is resident in the State, is a member of the Defence Forces or the spouse of such a member, is a civil servant in the Civil Service of the Government or the State, is in the service outside the State of the Government, the State or an international organisation, or is a volunteer development worker. The section also provides that a deciding officer may decide the question whether a person is to be deemed a home maker at any time.
Sections 12 to 14, inclusive, set out the conditions for entitlement to blind welfare allowance, the rates of payment, the provisions for the calculation of means, the consequential amendments and the transitional provisions to allow for the transfer of the administration of the scheme from the Department of Health and Children to the Department of Social and Family Affairs with effect from early 2009.
Sections 15 to 17, inclusive, set out the conditions for eligibility for receipt of domiciliary care allowance, the rates of payment, the consequential amendments and the transitional provisions to allow for the transfer of the administration of the payment of an allowance for the domiciliary care of children from the Department of Health and Children to the Department of Social and Family Affairs with effect from early 2009.
Section 18 clarifies the provisions for appeals for supplementary welfare allowance and inserts amended provisions for the administration of the supplementary welfare allowance, including the transitional provisions for the continuation of payments under the supplementary welfare allowance, SWA, scheme as determined by the Health Service Executive on the transfer of the operation of the scheme to the Department of Social and Family Affairs.
Section 19 clarifies the late claims provisions for the respite care grant. Section 20 clarifies the provisions concerning the making of regulations relating to payment to persons other than the claimant or beneficiary. Section 21 corrects an omission from the Social Welfare and Pensions Act 2007. Section 22 amends section 343 of the principal Act by removing the provision that a decision on any question relevant to criminal proceedings shall be conclusive for the purposes of such proceedings and replaces it with a provision that any such decision will be admissible as evidence in such proceedings. Section 23 provides for a technical amendment to correct the text inserted by the Social Welfare and Pensions Act 2007.
Section 24 provides for the disregard, for the purposes of rent and mortgage interest supplement, of any amount of carer's benefit in excess of the basic rate of supplementary welfare allowance — in line with current arrangements for carer's allowance. It also provides for changes in the rules for the calculation of the income disregard. The legislation is being amended to state that the disregard applies to all income and to clarify that additional income includes earnings, family income supplement and all maintenance.
Section 25 provides for miscellaneous amendments to the Social Welfare and Pensions Act 2007. These changes mainly arise from the recommendations of the report of the Pensions Board to the Minister for Social and Family Affairs on trusteeship. The report was published in November 2006. The recommendations in this report are aimed at enhancing both the governance of occupational pension schemes and the protection of the pension rights of scheme members. These changes will facilitate the implementation of recommendations in this report.
Section 26 provides for the definition of the principal Act for the purposes of Part 3. Section 27 proposes to bring registered third party administrators of pension schemes under the remit of the Pensions Act. Third party administrators are currently unregulated for scheme administration work carried out on behalf of the trustees of pension schemes. The Pensions Act is being amended to bring such third party administrators within the remit of the Act and covers certain core functions that they perform on behalf of trustees. Pension scheme administrators will now be required to register with the Pensions Board before they can carry out these core functions and the Pensions Board will have responsibility to audit administration service standards and to remove registration or apply sanctions if required standards are not met.
Section 28 provides for enhancements to the existing provisions for the training of trustees of pension schemes as recommended in the Pensions Board report. While trustees are required at present to disclose in their annual report whether they have access to trustee training, continuous and quality training is not compulsory and research has indicated that ongoing quality training is not the norm. The proposed amendments will put an obligation on employers to arrange trustee training for each individual trustee within six months of his or her appointment and at least every two years thereafter and will put an obligation on trustees to undertake this training.
Section 29 and Schedule 2 provide for a number of miscellaneous amendments to the Pensions Act 1990 which are mainly technical in nature.
The Bill provides for a small number of amendments to other Acts as follows: Sections 30 and 31 provide for consequential amendments to the Family Law Act 1995 and the Family Law Divorce Act 1996 to mirror the amendments made above to the Pensions Act 1990 on the matter of the definition of a defined contribution scheme.
I commend the Bill to the House.
