Dáil Éireann Debate, Thursday - 4 April 2019
32. Deputy Bríd Smith asked the Minister for Employment Affairs and Social Protection the estimated cost of full restoration of the telephone allowance including to those who may qualify but do not live alone; and her plans to address the issue in the next period. [15657/19]
View answerThe telephone allowance scheme was an element of the household benefits package (HHB). The decision to discontinue the telephone allowance was estimated to provide annual savings of €48 million at that time. These savings meant that my Department was able to retain the other valuable elements of the household benefits package such as the electricity and gas allowance and the television licence.
The cost of the telephone allowance scheme had risen significantly each year, as the number of eligible customers grew. At the end of September 2013 before it was discontinued, there were almost 396,000 receiving the telephone allowance compared to approximately 316,000 people in 2007. This was an increase of 25%, or an average increase of nearly 4% per annum.
The value of the telephone allowance before it was discontinued was €9.50 per month (equivalent to €114 per annum). Therefore, the cost of restoring the allowance at this level in 2019 might be estimated at approximately €52 million per annum, although the precise figure would depend on a number of factors.
While the telephone allowance was an important measure for vulnerable persons, the nature of the market has been transformed in recent years with deregulation, mobile services and bundled services including television, broadband and telephone. It makes the former notion of an allowance covering handset rental, standing charges and a number of calls somewhat outdated, when similar assistance can be achieved by increasing the rate of core payments, which benefit people regardless of whether they have a landline or not, and which can be spent by the recipients either on their landline-related costs, or on an alternative good or service of their own choosing.
Any decision to restore the telephone allowance would require additional funding for the HHB scheme and would have to be considered in the context of overall budgetary negotiations.
Separately, the new telephone support allowance (TSA) which was announced in Budget 2018 is a weekly payment of €2.50. The TSA is not the same as the Telephone Allowance that was part of the HHB package, and has different qualifying criteria to the HHB Package. Approximately 129,000 customers are in receipt of the TSA payment. The estimated full year cost of the scheme is over €16 million.
The primary objective of the TSA is to allow the most vulnerable people at risk of isolation, including the elderly and those with disabilities, access to personal alarms or phones for security. The risk of social isolation is clearly higher for those living alone than those who live with other people, especially where they have limited personal resources. Therefore the criteria for the allowance were framed in order to direct the limited resources available to my Department in as targeted a manner as possible. Accordingly, to receive the allowance a customer of my department must be in receipt of a qualifying payment and also in receipt of the Living Alone Allowance and the Fuel Allowance.
People who live alone would be considered among those most at risk of social exclusion, and this payment, along with the Living Alone Allowance, are also in part recognition of the greater challenges facing some of those living alone, in avoiding poverty. The deprivation rate of couples over 65 is less than half that recorded among those over that age who live alone, and while there are people living alone who have significant personal resources, this allowance is only paid to those who satisfy the means test of Fuel Allowance to ensure it is targeted at those most in need.
While the schemes operated by my Department are constantly reviewed, any decision to extend the scheme to people who are not in receipt of the Living Alone Allowance would have to be considered in the context of overall budgetary negotiations.
I hope this clarifies the matter for the Deputy.
