There will be a ten minute opening statement by the Minister for Social and Family Affairs, Deputy Mary Hanafin, followed by a ten minute opening statement by the Fine Gael spokesperson and a ten minute opening statement by the Labour Party spokesperson. There will then be an open forum on Vote 38 and questions on each individual subhead in the Estimate.
2009 Annual Output Statement .
The Minister, Deputy Hanafin, will make the opening statement. I suggest we then go immediately to each subhead and have questions on each of them.
We will hear a ten minute statement by the Minister, Deputy Hanafin, and then discuss each subhead. Is that agreed? Agreed.
I welcome the Minister and her officials, including the Secretary General, and look forward to their input.
I will confine my comments at this stage to pointing out some of the key aspects of the Estimates and the annual output statement because I have already dealt with some of the priorities. I know this information was only made available to the committee secretariat yesterday, so I hope it did not cause any inconvenience. Given that we have had the supplementary budget and the finalisation of the Revised Estimates volume, the time for preparing the briefing material has been quite limited.
The extent and the scope of social welfare spending is such that the income and support services operated by the Department of Social and Family Affairs impact on the lives of almost every person in the State. It operates 50 separate social welfare schemes and services and the needs and requirements of individual claimants can vary dramatically.
The following figures give some indication of the scale of business. In 2008, it received some 2.5 million claims and made 72 million payment transactions. More than 5 million telephone calls were received in headquarters. When qualified adults and children are included, a total of more than 2 million people will benefit from weekly payments. In addition to this, child benefit payments will reach more than 600,000 families, with nearly 1.2 million children, every month.
I would like to highlight the following overall expenditure figures before we get into the finer detail of the many figures the committee has before it. Total spending on social welfare by my Department has increased by €3.6 billion, or 20.1%, from €17.17 billion in 2008 to €21.3 billion this year. This corresponds to more than 34% of total gross current Government expenditure and 14.8% of gross national product. There will be €10.3 billion spent on social insurance schemes, while almost €11 billion will be expended on social assistance schemes. Of the latter, more than €2.5 billion will be spent on the child benefit scheme. Overall, a little over 2.5% of all expenditure is accounted for by administration.
The increase in this year's Estimates allocation reflects both the increase in recipient numbers in most schemes and the improvements in rates of payments and other conditions announced in the October budget . However, the single biggest factor is the increase in the numbers on the live register and the economic situation generally.
Expenditure on jobseeker's benefit and allowance is expected to exceed last year's expenditure by more than €2.5 billion. Expenditure on supplementary welfare allowance is also significantly increased because of the numbers on the live register, while lower earnings are resulting in increased expenditure on schemes such as family income supplement and the one parent family payment.
I would like to briefly revisit the 2009 budget which was announced last October. Our aim was to protect those in society who most need our support, including pensioners, families dependent on social welfare payments and those who are seeking employment. We targeted increases to deliver a package of supports for those who are mainly on a fixed income and are among some of the most vulnerable people in society. Among the key improvements were the following: the maximum personal rates of both contributory and non-contributory pensions increased by €7 per week; budget 2009 also provided for an increase of €6.50 per week in the personal rate payable to all recipients of working age; the rate of the fuel allowance increased by €2 or 11% to €20 per week and the duration was extended by two weeks from 30 to 32 weeks; the qualified child increase rose by €2 to €26 per week; and enhancements were made to family income supplement and the income disregards for the back-to-school clothing and footwear allowance to ensure more low income families qualified for these important supplements.
When these improvements are taken into account, basic social welfare rates have increased by nearly 64% since 2002, which is far in excess of three times ahead of the 18% increase in the consumer price index in the same period. However, the deterioration in the overall Government financial position meant that the Government had to make some key decisions to secure our economic future. For this reason, in addition to the improvements to which I referred, a number of measures were announced in October which were designed to save approximately €120 million in 2009.
In the recent supplementary budget, we kept social welfare savings to an absolute minimum, namely, €300 million in 2009. These will be achieved by increased anti-fraud activity, non-payment of the Christmas bonus, changes in the rent supplement scheme and the introduction of a lower rate of jobseeker's allowance for 18 year old and 19 year old people. While these decisions were difficult, particularly the decision not to pay the Christmas bonus, they had to be made to avoid cutting all the weekly social welfare payment rates and to keep the welfare budget at a level the State can afford. Overall, savings of €420 million in 2009 account for less than 2% of total expenditure. At the same time, the back to work and back to education schemes were refocused to ensure faster and earlier access to support for unemployed people who are trying to set up their own business or engage in further training or education.
I will now address the annual output statement. As members are aware, the annual output statement is a key element of the reforms to the budget and Estimates process which were announced by the Minister for Finance in the 2006 budget. The primary purpose of the statement is to enhance accountability and provide clearer evidence of the results of public spending by linking key outputs and strategic impacts to the financial and staffing resources of Departments.
The annual output statement before the select committee today is the third statement prepared by the Department. It reports on performance against the targets set for 2008 as well as identifying targets for the year ahead. It takes account of the experience gained from last year's statements and the revised guidelines approved by Government which were circulated by the Department of Finance. These guidelines require Departments to focus on one or two key output targets per programme. In the case of social and family affairs, the output targets chosen for four of the seven programmes relate, in the main, to claim processing times and control activity. These targets are chosen because they focus on the quality of the service we provide for the public and the measures taken to safeguard the taxpayer from social welfare fraud or abuse. In the current environment, the targets are very challenging.
Members may wonder why no targets are set for poverty reduction. The Government's targets in this regard are clearly stated in the National Action Plan for Social Inclusion 2007-16, which provides for a significant reduction in overall consistent poverty rates to between 2% and 4% by 2012. The annual output statement clearly indicates that poverty levels are the main impact indicators for the effectiveness of the programmes. It is not possible, however, to frame annual poverty reduction targets in the context of the annual output statement. By definition, poverty reduction is a multi-annual and multi-agency objective and progress is measured retrospectively. In this regard, the most recent EU SILC survey material which is currently available relates to 2007. The annual output statement, on the other hand, focuses on annual output targets at departmental level.
The Department has also introduced a number of changes to this year's annual output statement in the form of tables and charts with a view to making it more informative and easier to use. The annual output statement process remains a work in progress, both for Departments and officials and the members of the various select committees. I accept we need to continue refining the material we provide and, in particular, work on more measurable targets, especially in the area of administrative expenditure. I would welcome any feedback members may have on the annual output statement process in general and the Department's current statement in particular.
In terms of the 2009 Estimates as a whole, the annual output statement provides a high level view of expenditure from both the Exchequer and social insurance fund by programme area. Based on the Department's high level strategic goals, expenditure is divided across seven programmes. I will provide a brief overview of this expenditure. The children and families programme will account for 15.9% of expenditure or nearly €3.4 billion, of which €2.5 billion will be spent on child benefit. It is estimated that almost €534 million will be spent on the qualified child increase while €212 million will go on the family income supplement.
The single biggest programme relates to people of working age and accounts for more than 40.8% of overall expenditure or almost €8.7 billion. Jobseeker's allowance and jobseeker's benefit account for more than €4.6 billion while slightly in excess of €1.1 billion will be spent on the one parent family payment. Carers will receive €636 million in total.
The retired and older people's programme accounts for almost 27.2% of overall expenditure, or almost €5.8 billion. Of this, more than half of all expenditure, or more than €3.3 billion, goes on the State pension contributory, which is the single biggest social welfare scheme. A further €981.7 million and €1.3 billion, respectively, is expected to be required for the State pension non-contributory and widows' contributory pension for those aged 66 and over. The main payments for persons with disabilities include invalidity pension, disability allowance and occupational injuries benefits and account for €2.2 billion. The main areas of expenditure in the poverty and social inclusion programme are the fuel allowance and supplementary welfare allowance schemes. Some €217 million will be spent on the fuel allowance this year while the supplementary welfare allowance will account for slightly more than €1.1 billion.
The last two programmes are identity management and secure access to services and operational capabilities and modernisation. They account for almost 1% of total expenditure, mainly on the administrative budget subheads of Vote 38. Activities under these programmes include the issue of the public service card, fees to An Post for payments made at post offices, the maintenance and development of the Department's information technology infrastructure and staff costs for the central support sections such as personnel and accounts.
Turning now to sources of funding, members of the select committee will be aware that the Exchequer still makes the most significant contribution to social welfare expenditure in terms of resources as it funds all assistance-based schemes and child benefit. However, employees, employers and the self-employed also make a significant and valued contribution to the social welfare system through the operation of the social insurance fund. This year the income of the social insurance fund will be €7.6 billion but expenditure will be €10.3 billion, reflecting higher numbers of recipients and lower levels of employment and wages. The balance of expenditure over income will be met from the surplus accumulated in the fund over the period since 1997. However, it is estimated that by the end of 2009 the cumulative surplus will have declined to €649 million and will be eliminated by 2010, in which case the Exchequer will supply subvention.
I hope my opening statement has given a good overview of the Department's planned activities in 2009. The schemes and services operated by the Department benefit everyone in society, either directly or indirectly, and are the key platform for the delivery of social protection in our country. I look forward to discussing the Estimates with the committee.
I thank the Minister. I propose to take comments as we go through the subheads and I am in the hands of the members in that regard. I will now go through the list of subheads. Subhead A1 relates to salaries, subhead A2 relates to travel and subsistence and subhead A3 relates to incidentals.
On incidentals, an increase of €2.6 million is noted under No. 3, which relates to advertising, cleaning services, conferences and miscellaneous. I find it surprising that advertising and conferences are to see increased expenditure in this economic climate. Can the Minister explain what is included in this area?
I want to make one comment on this process; it is impossible to deal with the Estimates like this. We got the books yesterday afternoon and I was not free last night. I am sure this goes for others also. We were here at 10 a.m. today and this process is unsatisfactory for us. Why did this meeting have to be held today? If substantial material is to be supplied to committee members they should have a few days to read it before discussion. I am making this point so that it might be borne in mind in future years. I do not understand the rush. Was there some reason we had to deal with it so quickly?
I am advised that this meeting was scheduled and the material was not available until it was circulated to members.
The fault lies with the Department. This is highly unsatisfactory. We cannot be expected to digest all of this information overnight when nobody had any free time.
I apologised at the outset of my presentation. I accept these are complex issues and it takes time for people to go through them. However, I explained, given the amount of work we were doing in regard to the Supplementary and Revised Estimates, that it was not possible to get it out earlier. I am happy to give as much time here today as I can to go through the issues.
It is not only a matter of the complexity of the material. I did not have time to read it. It came in yesterday afternoon. I was busy yesterday afternoon. I got home last night at approximately 10.30 p.m. and was here at 10 a.m. today. There was no time to read it, never mind consider it adequately. We cannot do anything about it this year, but we need to agree a protocol so that in the future, in fairness to everybody, material will be available four or five days before a meeting and if it is not the meeting will be postponed until the following week. This is no way to do business. I am completely unprepared for this discussion because the material arrived so late. It is entirely unsatisfactorily.
There were unusual circumstances in which two particular events arose. I fully accept the Deputy's point.
It would have been better if a call had been made on this yesterday. If the material was not available until yesterday the Minister should have contacted the clerk and committee members to postpone the discussion.
That is a matter for the committee.
We did not have an opportunity to discuss it until today. We did not meet as a committee, so we had no opportunity to seek to have the meeting postponed for a week so that we would have time to digest the material. The Minister's officials are here and none of us wants to send them away and ask them to come back next week. The point being made is that there should be a better process. We went through this a fortnight ago in regard to the Social Welfare Bill and the pension changes when, on Committee Stage, we were given a new raft of amendments and a new Second Stage without prior notice. This is not the first time this has happened. It does not allow for good scrutiny and, from the Opposition's point of view, the job we are supposed to be doing is scrutinising the decisions being made and the figures. One needs time to do that properly and that time has not been given to us.
The figure for staff training and development seems low. What is the Minister's view regarding the adequacy of the expertise available in the Department. I have not seen any report in recent times on the specific expertise or professional qualifications available within the Department. Does the Minister believe there are areas of weakness where staff need additional training?
The advertising budget is down €440,000. The cleaning services budget is also down. The increase there relates to a contingency fund of €2.8 million which had to be parked somewhere. It is not specifically targeted at advertising, cleaning services or conferences.
What is it likely to be used for? When the Minister negotiated with the Minister for Finance, how did it come about that she has a contingency fund?
It can be used for anything in the administration budget. It is not specifically confined to advertising, cleaning services or conferences. It was just, as it were, parked there.
It is strange.
On staff training and development, there is a central training unit and regional and local unit for full-time training. Where any outside expertise is needed it can be bought in.
Is the Minister satisfied with the level of expertise currently available within the Department?
In regard to different issues being developed in the Department, for example in regard to pensions, we have had access to expertise from outside. I am not aware of any major gaps that we have been unable to fill.
It seems to be quite a low figure for such a large Department.
They are probably able to access central training. This sum of money is for external training only. Internal training is covered elsewhere.
That is all right.
Subhead A4 is postal and telecommunication services.
I am surprised that figure has gone down, given the significant increase in the number of claims and so on and the concentration on control measures. Does that reduced postage figure indicate a reduction in control?
We have more people moving on to electronic transfer. We are not planning as many massive mail shots this year. Electronic transfer is one way of avoiding postage costs.
Subhead A5 is office machinery and other office supplies and related services and subhead A6 is office premises expenses.
A sum of €3.5 million has been allocated for buildings. The Minister made some commitments today and previously in terms of new offices and so on that need to be provided. Where are these new offices to be located? Has the Department of Social and Family Affairs examined the possibility of sharing space with the local authorities or the HSE. I am aware the Department shares accommodation with the HSE in the health centres. Some local authorities have space in their buildings. Would it be possible to rent some of this space, or is that a function of the OPW? There is room for flexibility, and I am aware that MABS and Citizens Information have shared space. This makes sense and provides a better service for the customer who is not running from Billy to Jack all the time.
I wonder if the provision of €3.5 million will provide the Department with the accommodation it needs?
On the question of accommodation, how much of the required accommodation is additional space for additional staff? I would have thought the figure should be higher. Does the Minister expect the figure to be higher at the end of the year?
On the issue of people queuing outside offices in all types of weather, is the Minister considering the possibility of renting space for additional waiting areas? In some situations, there may be space in other public buildings where people could wait indoors.
The OPW has responsibility for the provision of office accommodation for the Departments.
The new local offices are planned for Ballina, Balbriggan, Cavan, Killarney, Mallow and Swords. Offices in the following locations are undergoing refurbishment and additional accommodation is being provided in Ballyfermot, Belmullet, Clondalkin, Cork, Dunfanaghy, Limerick, Longford, Monaghan, Navan, Tralee and Waterford. The sum of €3.5 million is provided for the fit out only. The OPW carries the cost of lease or construction from its budget.
On the question of people queuing, more important than accommodation is the appointment system that we are putting in place and that is operational in 14 offices and will be spread out to more. That works successfully.
Is it the intention to have that system available everywhere?
Yes, certainly in all the areas experiencing pressure of numbers. The staff have adapted very well to that system. I must give credit to the staff in the Dundalk office who initiated the appointment system. What one notices, and this is always captured on camera, is that people tend to queue first thing in the morning, however, if one goes in the afternoon, there is nobody queuing. It is very hard to change a practice; people are in the habit of getting up and going out for work. The appointment system is the way to go.
Is Balbriggan in that first list?
Yes, it is a priority.
Subhead A6 is office premises expenses and subhead A7 is consultancy services.
Savings can be made in consultancy services but will the work formerly done by consultants now be done in house by the Department? Will less work be done in those areas?
Consultancy work tends to be connected to IT involving technical advice on the management of our programmes and there is a limited amount of in-house expertise in those areas. Other consultancy services involve the commissioning of reports on strategies and making recommendations. The biggest reduction will be in this area, amounting to 48% of the total, and we will try to do that work in house.
Is there a detailed breakdown on consultancies?
There is technical development advice, business objects modelling advice and expertise and so on.
Maybe the Minister will send that information to the committee. Are poverty measures not handled by the Combat Poverty Agency and the Office for Social Inclusion? Surely there is expertise in those bodies.
We have allocated €80,000 in respect of the ESRI but the rest will be under the new integrated unit.
How many researchers are there in the Department? Is it possible to provide us with a profile of the Department in terms of its professional expertise?
Some 5,000 people are employed throughout the Department but I will see what can be done in that regard.
I am asking about staff outside the area of administration, such as those in social policy research or the provision of legal services.
We will get whatever information we can.
I concur with my colleague that we need to know what expertise there is in the Department. Given the stringent financial situation it is an ideal time to look at the area of consultancies and agencies. They have grown at an alarming rate and, while we must sometimes seek expertise from outside, there must also be some expertise in the Department.
Most of our consultancy is IT-related. A good IT system is needed for paying what we pay each week.
Subhead A8 is payments for agency services.
When was the payment to An Post last negotiated?
It amounts to almost €34 million and was negotiated in 1996.
When is it due to be negotiated again? It seems a long time ago.
We have been the salvation of small post offices around the country. I do not know if it is intended to renegotiate the rate.
Is it a rate per transaction?
There is a basic rate. We advertised our plans to finalise the current arrangement with An Post for a period of up to five years ending 31 December 2013 and to undertake a procurement process in the coming years, in accordance with European law, for the future provision of payment delivery services, the contract to be reviewed annually during this period.
To what does the reference to section 280 of the Social Welfare Consolidation Act 2005, on payments to medical doctors for certificates and reports, relate?
The €32.5 million will be for invalidity, disability and illness benefits.
It seems like a big increase. We have seen a dramatic increase in payments for unemployment but, in proportion to the overall figure, an increase of €2.1 million seems substantial.
They are paid for every report and certificate. I mentioned this when referring to the rise in the number of people claiming disability benefit. They must have medical certificates.
Does the Minister negotiate this with the Medical Council or who conducts the negotiations?
Recently we announced a reduction of between 7% and 8%, on average, in the rate payable to professionals.
Does that figure include the reduction?
It does. There has been an increase in the number of certificates.
Has the Minister a breakdown of that enormous figure? How many certificates does the figure represent and what payment is made for each?
Apparently we pay around €8 per medical certificate and €44 for a medical report. A person on illness benefit must send in a certificate each week.
Subhead A9 relates to value for money and policy reviews. Subhead A10 is e-government related projects. If everyone is all right with part A I will move on to part B, which relates to social assistance and the State pension. Subhead C relates to the blind pension, subhead D relates to child benefit and subhead E relates to jobseeker's allowance.
We discussed this but, regarding the issue of legal barriers to taxing or means testing child benefit, has there been recent legal advice?
A legal barrier was only brought up in newspapers. The Commission on Taxation is examining all aspects of the taxation of child benefit. We have given the commission all the information we have in that regard.
The Minister referred to difficulties.
I referred to logistical difficulties. If one imposes a means test it requires means testing 600,000 mothers and that poses an administrative and logistical difficulty. If one imposes a tax there will be issues relating to income earners.
This is not just about newspaper reports. When taxation of child benefit was discussed in the 1990s there was advice that it would not be legally possible because it is a payment for the child. Has the Minister received recent legal advice on this?
There has been no new legal advice. The advice at the time was that it is for the benefit of the child but is a payment to the mother. The payment is obviously not made directly to the child so the legal impediment people raised was not valid.
The taxation could end up being levied on a person other than the one receiving the payment.
The mother——
The husband; that is, the father of the child. Are there legal issues in this regard? I am working from my memory of many years ago when this was in the public arena. Are there legal issues?
No. All of the matters relating to means testing and taxation are being examined by the Commission on Taxation. There are administrative and logistical difficulties, as I indicated. We must ensure there is no disincentive for people seeking employment; there are policy issues involved. I am not aware of any legal issues relating to the administration of means testing and taxation but the Commission on Taxation is examining the area. It is an area to which we must apply our minds in the coming months.
Has the decision been taken to limit child benefit? Is it just a matter of deciding which mechanism to use?
The Minister for Finance indicated in his Budget Statement that the Government would do one or the other.
Subhead E is jobseeker's allowance and subhead F is the farm assist scheme.
On subhead F, there is a very low take-up of the farm assist scheme. In County Offaly the most recent estimate is that 67 farmers are in receipt of an allowance under the scheme. I would probably know more who would be eligible to benefit from it. When I ask people why they have not applied they give me various reasons. Some people are in dire circumstances and I wonder whether anything can be done and whether the Minister has had any discussions with the farm organisations with a view to making people more aware of the scheme. It is an important scheme and could be of assistance. However, there seems to be some sort of barrier to applying for it as was the case in respect of the family income supplement before public awareness of it was raised.
I understand a number of farmers opt for the rural economy sub-programme rather than this. The two, therefore, need to be examined in conjunction with each other. There has been a good take-up of that scheme.
Is that the responsibility of the Department of Community, Rural and Gaeltacht Affairs?
Yes. Take-up of that scheme probably compensates for the low take-up under the farm assist scheme.
Subhead G is employment support services.
The figures in regard to the back to work and back to education allowances seem very low relative to the live register figures.
There is an increase of 6% in respect of the back to work allowance. There is also an increase in respect of the back to education allowance. If more people apply we will continue to provide them.
One would expect more people than that.
There has been an increase of €20 million.
It seems conservative. I would have thought it was a scheme that should be promoted.
Is the Minister not anticipating, given the changes made in the budget, that more people will come onto it? That should be the aim.
They could also be availing of VTOS, FÁS or some other schemes that are not paid out of this budget. The chances are, given the availability in those schemes, that they are the ones that would have the biggest take-up.
Subhead H is the pre-retirement allowance, subhead I is the one-parent family payment, and subhead J is the widows'/widowers' pension and guardian's payment.
In regard to the widow's and widower's pension, is this group subject to any activation measures?
No. They are treated in the same way as a qualified adult or a lone parent.
The Minister spoke about activation measures in respect of lone parents.
Subhead K is social assistance for deserted wives without dependent children and subhead L is family income supplement.
Does the Minister have up-to-date figures on the take-up of the family income supplement?
I read a report this week which stated that the numbers taking up the family income supplement have fallen. That should not be the case unless people are going onto the live register and getting unemployment assistance, in which case they would not be eligible for the family income supplement. Given the numbers of people who have been put on a two or three day week, I would have thought many more people would be eligible for the family income supplement, and the fact that the Minister is allocating more money for it supports that argument. Is there any truth in the report?
The study we did of FIS showed that the take-up was quite good, contrary to the view that had been expressed earlier. People will be coming off family income supplement because they have lost their job. Family income supplement is a payment for low-paid workers. Others will become entitled to FIS. That is why we have made provision for it.
Has there been a decrease in the numbers entitled to FIS?
I would be surprised if the overall numbers were down.
Will the Minister examine the issue of FIS and forward information on it to me?
Yes.
When Deputies include FIS in their leaflets, there is a significant number of queries which is indicative of a low awareness of the scheme. The Minister may be aware of the letter in the newspapers recently about a family who would be better off on welfare than working. It was circulated to members by several people.
Yes, a family with four children.
Yes. That report on the family income did not include the FIS payment. That family would be entitled to a significant FIS payment. I think much remains to be done in terms of promoting an awareness of FIS. I know it may be difficult to do it in the present climate where the budget is going through the roof, but at the same time, it is important that people are made aware of the supports that are available to them in employment and it is important to keep as many people in employment as possible.
The increase would also be due to the fact that the bands were widened in the last budget, thus increasing the number of people who could participate in it.
It will also become much more significant if the Minister makes any changes to child benefit. There is a need to create a public awareness of FIS.
Subhead M is the carer's allowance and subhead N is the supplementary welfare allowance.
Are we going to go through each subhead?
Yes.
There were significant increases because of delays in processing.
Demand. It also includes the back to school clothing and footwear allowance, so more people will qualify for that as well. The basic supplementary payment will be up.
On the significant increase in the volume of work, what is proposed in terms of additional staff to meet the demands for that service?
The Deputy will be aware that a business case is being made through their own Department for additional staff. I think, no more than our own staff, they have a good case. They have not made that case yet.
Is the cost of that carried by the Department of Social and Family Affairs?
No. They are employed by the Department of Health and Children and the HSE, so the business case for additional staff must be made to them.
There is a 2% increase in the budget for administration — €64 million for administration in the Department of Social and Family Affairs, yet it does not employ the staff.
We pay the staff because we reimburse the HSE for the cost of the salary.
Okay.
If the HSE pays the salary, the Department pays the HSE back.
I did not know whether we were going to discuss this subhead separately?
We agreed.
I was not here at the time. I wish to raise an issue on the back to school clothing and footwear scheme. It was brought to my attention a number of times that people felt 1 June was too early to have the scheme in operation and that it should be in operation later in the summer, towards September. Two concerns were brought to my attention. First, the money was not being spent, perhaps through necessity, on school items or footwear and, second, the sales were more likely to take place in August and money might go further at that time.
The scheme runs until the end of September.
I know.
Therefore, people do not have to spend it until the beginning of September, if they do not want to. The book lists go out and uniforms are available in the shops in June. I know it takes a great deal for a family to be that organised if they are going to buy a uniform for September. We are trying to spread it out and give people the option.
I know the point the Deputy is making. It can be a valuable income for people. If we left everybody until the last week in August it would not be of much help to them.
Subhead O is disability allowance.
On the Disability Act 2005, a number of people have told me there appears to be a pullback in the provision allowing people on disability allowance to do rehabilitative work. I cannot understand why that should be. It will not save the Department any money as the same payment will continue to be made. Has any directive been sent to the Minister on this matter? Has there been a crackdown on this provision?
There has been no particular crackdown but people have received letters telling them that their time has expired or that, if there is no prospect of their returning to full-time work, they will not be able to fully benefit from rehabilitative work. However, no specific group has been targeted in this regard.
If the time has expired and a person still has a disability, what is wrong with letting him or her do 19 hours' work? It may not help a person who has a physical disability but it would benefit people mentally to do something and feel they have a purpose. I understand that the allowance is for people who may get back into full-time work but is it not better for people to do a limited amount of work than nothing at all?
I have experience of people whose rehabilitative work has been discontinued. The condition that a person must be on disability allowance in advance of applying for rehabilitative work is unjust. Some people who become disabled would like to apply for some type of work. The rules are very strict and I am not sure of their benefit from the point of view of the Government, but in some of the cases I have dealt with they seems to be detrimental to the applicants.
We are talking about the exemption for people on illness benefit and rehabilitation and so on. On the other hand, if a person is capable of working 19 or 20 hours a week should he or she continue to receive illness benefit?
That is a medical decision. I am not disagreeing with the Minister.
The medical decision is that such people are not capable of work, and here they are working. If it is to their benefit to work, perhaps they would be better off by working and claiming FIS rather than claiming illness benefit and working at the same time. There are people who are well capable of going back into the workforce, perhaps on a part-time basis.
The Minister should examine that area.
There are no incentives for people to do that if we continue to pay illness benefit while they work.
If they stop working they will continue to claim illness benefit. It may also drive some into the black economy.
The illness benefit is designed for people who are not fit for work.
Rehabilitative work can take many different forms. A person can sit in an office saying "hello" to people or cutting grass for half a day every fortnight.
The Deputy is talking about people doing up to 19 hours a week. We all know of people on full illness benefit because they are not capable of working. The Deputy suggests they receive full illness benefit of €175 plus income, even though they are not capable of working.
If that argument is taken to its logical conclusion the Minister should examine whether some people should receive illness benefit. At least the Department would make a saving. If people are fit for work they are fit for work but I know people with physical disabilities who can do very limited work but for who the prospect of working for a few hours per week is of huge mental importance. It is not the money but the fact that they are doing something.
The letter indicates that people should consider returning to full-time work. They may want to make a choice as to what direction to take.
I know of one person who made a choice in the other direction. We are not saving money either way.
No, but it is not always about saving money. The real question is whether a person is entitled to illness benefit in the first place if he or she is capable of working 19 hours a week.
Have we finished discussing subhead O?
The Fine Gael member is not suggesting the Minister cut illness benefit but if she did so she would be the subject of Private Members' business in the Dáil.
I am not suggesting that.
I said the Deputy did not suggest it.
I suggest that the people who receive a payment must be entitled to it. I will look reasonably at anything the Minister proposes to save money as long as people get what they are entitled to.
Subhead P is respite care grant and subhead Q is free schemes assistance.
Can the Minister explain why there is a social insurance fund element for each of those subheads? How is it worked out?
Household benefits to people on contributory pension come out of the fund.
I recently raised the question of control measures in regard to nursing homes and I believe there are many potential savings in this area. I suggested the Minister put in place a system of notification.
As I said, we are following up on that suggestion.
Could the Minister briefly explain how the payment system operates for free travel? I understand a pass is issued to a person of a certain age.
It always amuses me that the public think nobody pays for free travel. The Department of Social and Family Affairs pays a transport provider based on a survey of usage which that provider carries out.
What is the annual payment?
It is €76.5 million.
What is that per person per journey?
One might ask what the value of the pass is to people.
What is the notional value?
It is approximately €200.
Do eligible people get a ticket when they travel?
They get a pass and a ticket.
What about travel on buses?
One shows the pass when getting on a bus.
How do the companies quantify usage? I know of many areas where one can get a pass but cannot go anywhere because there is no transportation.
Think of all the people who have it but do not use it.
Is there an element for which the Department is paying but which is not being used?
The Department spent €500 million in 2009 on utility bills or contributions to same. The Department must have an interest in bringing down the costs of utilities and the Government is trying to do that. Does any section in the Department look at the price of electricity, telephone or bottled gas, the last of which seems to be very high in price this year?
We only pay for units used. People welcome the fact that the cost of gas and electricity have come down. One third of older people do not actually use their full quota of electricity.
Is that a cost to the Department?
No because we only pay for what is used. We have put a value on that of some €540. I believe that is the value. One can then add another €200 for the free travel. That is an additional benefit to older people that nobody costs.
Somebody in the Department should push the agenda of lowering utility costs in general, mainly telephone, fuel and electricity. The cost is huge at almost €500 million. The Department is giving out a fuel allowance too. That is probably less than the actual cost, but it is still relevant.
The fuel allowance is separate from the household benefits.
I understand that.
That is €216 million.
It is still money being paid out purportedly for fuel. It is for fuel; I am not suggesting otherwise.
It is interesting to look at the breakdown. There is €200 million in the electricity allowance and €56 million on the free television licence. Again, that is something people think nobody pays for. The telephone allowance is €108 million. The value of the household benefits per person, including the free travel, is €1,000. This is something we never talk about in the context of pensions, even when comparing this country with other countries. We tend to look at just the flat rate of payment rather than the cost of the additional benefits.
It is €1,000 for each recipient. Does that include the fuel allowance?
No. It is the household benefits package, which is the electricity allowance, television licence, telephone allowance and the free travel. It amounts to €1,000, which is significant.
We will turn to subhead R, which relates to MABS.
Why is there a reduction of almost €4 million given the huge demand for services and the Minister's earlier remark that she would also provide extra staff?
It must be the administration overhead. I am sorry. I should have the answer to the Deputy's question but I do not. I will come back to her about it. It must be on the administration because we are expecting additional costs.
Subhead S is the grant to the Family Support Agency.
What valuation of the work done is carried out? The Minister sent us a press release showing the amounts given to each of the bodies under the agency. It was striking that there were no new ones. Any body that got a payment the previous year got something the next year. What assessment of need is carried out? Is there still the same need in the localities of the existing centres? Are there other places throughout the country that do not have bodies linked to the Family Support Agency but which have that need? How do they get into the system now or is that possible in this climate?
With regard to the grants, the Deputy is correct about all the bodies that had been receiving funding. However, they must fill in the application and justify the claim that they need money. I am not sure if there are a couple of new bodies in the list this time.
I do not believe there is but I am relying on my memory.
A large portion of that €11.8 million — approximately €8 million — goes to major national bodies, such as Accord. There is an issue with the family resource centres, and I have spoken to the Family Support Agency about it. We have been unable to progress any new centres this year, and we probably will not next year either. However, that has given us an opportunity to step back and consider. It should not be the communities that are the most organised for filling in the form that should get them. When I looked at this I realised there are new communities and areas that have a great deal of diverse need but which do not have the capacity to make the application because they do not yet have a community base. I have met the Family Support Agency and asked it to actively examine this and work with those communities. It is no secret, for example, that with the existing family support agencies there is an imbalance towards rural areas. There is a huge number from Donegal, and there is a pile of new applications from Donegal. I am sure every one of them has merit but in east Meath, Louth or Kildare, for example, there are many new communities that do not have one of these. It is necessary for people to go out and actively support them in making the application for it. That will happen.
The Minister indicated that it is more of a phenomenon in rural Ireland. Rural areas are very organised under the partnership system. Are there links with that? There are partnership bodies that are good at filling out application forms. Is the existence of such agencies part of the reason for the imbalance? They are being funded by another Department.
The main criterion is that the area must be disadvantaged in the first instance. I have no doubt that those groups have been more successful because of their expertise with partnership programmes, Pobal and applications for the grants that are available through the Department of Community, Rural and Gaeltacht Affairs. In fairness to the Family Support Agency, it identified a need in Moneenagisha in Galway and proactively established itself there. I have asked it to do more such work, especially in terms of new communities.
Subhead T1 is the Combat Poverty Agency, subhead T2 is the EU community action programme for employment and social solidarity progress, 2007 to 2013. Subhead U is the grant to the Citizens Information Board. Subhead V is the dormant accounts expenditure on economic and social disadvantage.
Will the dormant accounts funding that has not been drawn down to date be drawn down in 2009?
Yes, it is to be drawn down.
Subhead W is the domiciliary care allowance and subhead X is miscellaneous services.
Is there any evaluation of the quality of school meals? It is one thing to provide children with meals to get them through the day. I accept there is a list and a pricing mechanism and I have read the details in that regard. The Minister will have seen the disparities in terms of the quality of food that is provided when she was Minister for Education and Science. Unfortunately, sometimes it can be cheaper to use poor quality food. Taking obesity into account, it is important that we give children the best quality possible and that strict guidelines to that effect should be issued. Is any member of staff in the Department assigned to evaluate school meals and to carry out spot checks to ensure children get healthy food?
The Department carries out spot checks on schools to ensure that the money has been properly spent. In conjunction with the Department of Health and Children the Department is working on healthy eating criteria. We will do further work on that area this year.
Subhead Y is appropriations-in-aid. As there is no subhead Z are there any questions on the output statement?
On the social insurance fund, it was indicated that it would run dry by the end of 2010.
No, it will be earlier than that. That will happen early in 2010. I emphasise that the Exchequer will subvent any gap. Money will continue to come into the fund, it is just that there will be a gap.
Does the Minister have a projected shortfall in terms of what will be required?
That is difficult to predict. If we did not have a surplus this year the shortfall would have been approximately €3 billion. The surplus allowed us to compensate for that. It is difficult to say what the employment rate will be next year and what will be the income from that. We reckon that the State's subvention to the social insurance fund next year will be somewhere between €3 billion and €4 billion.
Are there any other questions or comments?
Have we any information on how much has been lost to the Exchequer through companies going to the wall and leaving outstanding PRSI bills behind them?
We do not have it apparently. It is a Revenue matter. Any checks that were carried out on PRSI tended to be of very high compliance. For the most part, companies would tend to be up to date. Any figures we have on controls on PRSI suggest that they were a very compliant group, but we do not have the figures on recent companies.
Would it be possible to get information on that from last year?
The Revenue Commissioners have it.