Employment Support Services

Questions (67)

Claire Kerrane

Question:

67. Deputy Claire Kerrane asked the Minister for Social Protection if she will provide an update on the tender for local employment services; the length of time the tendering process will be open for applications; if the terms of reference will include changes to the current model of employment services from a cost-met model to a cost bid model; and if she will make a statement on the matter. [26485/21]

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Oral answers (6 contributions) (Question to Social)

Will the Minister provide an update on the forthcoming tender process for local employment services and job clubs? She will know that this has been a matter of concern to those who work in these services. When will the process begin, how long will it last for and will the terms of reference include a move from the current cost-met model to a cost bid model?

I thank the Deputy for raising this matter. My Department is finalising a request for tender with the aim of establishing new local employment-type services in areas of the State where they do not currently operate. I expect this tender to issue shortly and the details of the procurement will be outlined in the published request for tender. The forthcoming procurement process will not impact the contracts of existing providers in other areas. I expect the tender will prove attractive to local community-based organisations, including local development companies. My Department has obtained legal advice that such services must be procured though open competitive procurement processes in line with EU and national rules.

Cost-met funding models require scrutiny of day-to-day expenditure, placing an undue administrative burden on the employment service provider and my Department. This approach diverts valuable resources away from clients and does nothing to enhance employment outcomes for the long-term unemployed or others supported by the service. Moving to multi-annual funding, with payment for each individual referred to the service, coupled with a strong emphasis on quality service provision, will reduce the administrative burden and is more likely to deliver enhanced outcomes for clients.

Separately, all current employment service contracts expire at the end of 2021. In many cases, these contracts have been in place for more than 20 years, with no formal procurement being undertaken in that period. This is not in compliance with the requirements of good governance or proper procurement. My Department is developing requests for tender to ensure that sufficient high-quality employment services are procured in a manner that is compatible with procurement rules. Organisations with strong experience in the delivery of similar services at community and local levels will be in a strong position to respond to the requests for tender when they issue.

I was hoping to get more than a reference to "shortly", as the latter is difficult to interpret and define. If the extension of the initial services to the four new locations is expected to be rolled out from July, I imagine that the tendering process is due any day now. Perhaps the Minister could provide further details on that.

What concerns me about the Minister's reply is the move to a multi-annual funding approach that pays for each jobseeker referred to the service, which is in essence JobPath. JobPath has failed, is not a quality service and has not served the jobseeker nor the taxpayer well. JobPath has cost the taxpayer €259 million and counting since 2015 whereas the likes of local employment services cost between €17 million and €20 million per year. For a decent number of people who have been referred to it, JobPath has not led to employment that has been sustained for longer than 12 months. Will the Minister provide the House with information on the future of the JobPath service in line with this contract for services?

I agree that fantastic work is being done by local employment service providers across the country. The local employment service in my county of Monaghan is led by Mr. Francis McCarron, who does good work helping people with career guidance, CV and interview preparation, and upskilling and training supports. This is the case in many local employment services and I assure the Deputy that I recognise the great work being carried out by many of our local employment service providers. As Minister, however, I must follow the legal advice that I am given. To do otherwise would be a dereliction of my duties. The clear legal advice that I have been given by the Attorney General is that my Department is in breach of EU procurement rules and we need a competitive procurement process for these contracts. In addition, the Comptroller and Auditor General found in his 2019 report that the Department was not in adherence to public procurement policy.

The Minister has made the case for why this tendering process is necessary. That is fine, but my concern is that, ahead of the tendering process, she is talking about paying for each jobseeker referred to the service. That is a move away from what local employment services are doing well. I am glad that the Minister recognises this, as they are reputable. The 2018 Indecon report showed how well got they were in the communities they served, their good relationship with local employers and how they worked well and efficiently with those who came through their doors. We must remember that local employment services have a much wider remit, in that they do not just deal with jobseekers referred to them. They have walk-in and wrap-around services, which will be vital as we emerge from Covid-19, that other services like JobPath do not have.

I wish to ask about the external report on contracted services that was carried out last year. It went to the labour market advisory council, whose response the Minister received at the end of March. Will she provide the House the detail of the report and will she publish it?

That report will be published in due course. Local employment services form only one part of this jigsaw. There are a number of aspects, for example, the Intreo offices, where I have increased the number of staff to help people locate jobs. Unfortunately, many people will not get their jobs back when the economy reopens fully. We want to help them find other jobs. A number of approaches to this work are being taken, including local employment services, JobPath and Intreo. Above all, we do not want to reduce any of those services. With this request for tender, which I hope to publish very shortly, I aim to expand services in areas where we do not have a local employment service currently.

Departmental Schemes

Questions (68)

Denis Naughten

Question:

68. Deputy Denis Naughten asked the Minister for Social Protection if she will reintroduce the mortgage interest supplement; and if she will make a statement on the matter. [26490/21]

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Oral answers (6 contributions) (Question to Social)

The primary objectives of all measures across the housing sector should be to increase supply of accommodation and keep people in their current homes, be those rented or owned, where those homes meet their needs. While State support is available to those who are renting and cannot meet their housing costs, the State has, since 2014, turned its back on those who have a mortgage and have lost their jobs. This is unfair.

I thank the Deputy for raising this issue. The original purpose of the mortgage interest supplement scheme was to provide short-term support to eligible people who, due to temporary unemployment or loss of earnings, were unable to meet their mortgage interest repayments in respect of a house that was their sole place of residence.

The 2011 interdepartmental mortgage arrears working group report, known as the Keane report, identified mortgage interest supplement as an inappropriate long-term support. The central tenet of the report's findings was that mortgage interest supplement did little to assist families in improving the long-term difficulty in addressing their mortgage problem.

The scheme was discontinued because it did not address the long-term challenges for people in serious mortgage arrears. While it covered the interest payments on a mortgage, it did not reduce the value of the outstanding mortgage debt and it acted, in effect, as a subsidy to the lending institution while creating a potential welfare trap for the customer.

The scheme was discontinued for new entrants from 1 January 2014 on the basis, as I said, that the ongoing payment of mortgage interest supplement did not address the long-term housing challenges for people in serious mortgage arrears. There are currently 492 households receiving mortgage interest supplement from my Department, down from 9,768 when the scheme closed in 2014. The Central Bank's code of conduct on mortgage arrears, CCMA, provides a more appropriate framework for customers, with the responsibility of forbearance for mortgage difficulties resting with the mortgage service provider. In accordance with the CCMA, lending institutions are encouraging customers to contact them at the earliest opportunity regarding their concerns and any particular circumstances that may impact on the customer's financial well-being.

Additional information not given on the floor of the House

The Money Advice & Budgeting Service, MABS, under the aegis of the Citizens Information Board, continues to provide assistance to people, in particular those on low incomes or living on social welfare payments who are over-indebted and need help and advice with debt problems. As part of its free services, MABS provides help and advice to those in mortgage arrears.

I accept that mortgage interest supplement should be a short-term measure. The problem is that there is no short-term measure in place at this time. Three years after the scheme closed for existing recipients, there were still 1,700 people receiving payment. After intensive support being provided by the Minister's Department and direct engagement with the financial institutions, 1,700 people were still getting payment under the scheme. Clearly, the other supports that are in place are not working. If 1,700 people were still on the scheme three years after it closed and 400 are still on it today, seven years after it closed, and given that the Minister has had the weight of her Department available to her and has had direct engagement with the financial institutions, it is obvious that the existing alternative mechanisms are not working.

Abhaile is the national mortgage arrears resolution service. It is provided free of charge to insolvent borrowers who are at risk of losing their home due to mortgage arrears. Abhaile is focused on providing expert financial and legal advice and assistance to borrowers to identify and put in place solutions to their arrears and, wherever possible, enable them to remain in their home.

From the inception of Abhaile in mid-2016 through to December 2019, 17,640 individual borrowers in mortgage arrears, or almost 15,000 households, received independent expert financial advice and negotiation support from Abhaile aimed at getting a solution in place. More than 8,000 borrowers facing repossession proceedings have received advice and assistance at court from an Abhaile duty solicitor. Almost 1,900 borrowers received legal advice from Abhaile consultation solicitors.

I note what the Minister is saying and I do not dispute it. In fairness, Abhaile is a great service. However, there are people falling through the cracks. Her Department has accepted that, given there are 400 families still in receipt of mortgage interest supplement seven years after the closure of the scheme and following intensive engagement with them. I want to focus on the unfortunate families who in the weeks and months ahead, as the pandemic unemployment payment, PUP, ceases and they try to go back to work, will find there is no job available for them. The current mechanism is only kicking the can down the road. Those people need a short-term supplement to ease the mortgage pressure they are under, rather than just loading more debt on them until they get new employment. As a temporary measure, we should allow the payment of mortgage interest supplement in those circumstances.

The Abhaile programme has worked well. At the end of December 2019, nearly 35% of the 17,640 borrowers who engaged with Abhaile financial advice either had a solution in place or were on trial. A further 47%, or 8,317 borrowers, were still in their homes and receiving ongoing support from their Abhaile financial adviser to get a solution in place. I know the Deputy will agree with me that anybody in any financial difficulty should go to MABS. It provides a wonderful service in giving people support and helping them to plan for and figure out how to deal with the challenges they may have. I encourage anybody in difficulty to avail of the supports available through the MABS offices.

Covid-19 Pandemic Unemployment Payment

Questions (69)

Claire Kerrane

Question:

69. Deputy Claire Kerrane asked the Minister for Social Protection if there are plans to cease the pandemic unemployment payment by the end of June, as set out in the 2021 further Revised Estimate; if so, the plans in place for persons in receipt of the payment who will not, or are unable to, return to employment over the coming months; and if she will make a statement on the matter. [26486/21]

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Oral answers (6 contributions) (Question to Social)

My question relates to the pandemic unemployment payment, PUP, and its future in the weeks and months ahead. I hope the Minister will be able to provide an update on it.

The PUP is available to employees and self-employed persons who lost employment due to the Covid-19 crisis. To date, expenditure on the scheme is approximately €7.5 billion, which demonstrates the Government's absolute commitment to those affected by the crisis. As restrictions are eased further over the coming weeks and months, I expect people will be in a position to close their PUP claims as their employers reopen and they return to work. The experience to date is that people returned to work when restrictions were eased and it was safe to do so. At its peak in February, almost 482,000 people were availing of the PUP. This number dropped to approximately 376,000 by last week, which is a reduction of more than 105,000 already this year over that three-month period.

For persons who are not yet in a position to return to work, the PUP will continue to be paid at its current rates and the scheme will remain open to new entrants until 30 June. The Government will set out plans for the future of the payment beyond June over the coming weeks, taking account of the trajectory of the virus, progress on the vaccine roll-out, which is going well, progress in terms of people returning to work and the continued impact of the pandemic on the economy over the period ahead.

I am acutely aware that there will be recipients who may be unable in the coming months to return to employment in the sectors most badly impacted by the pandemic. For this reason, my Government colleagues and I have clearly stated that payments will not be withdrawn suddenly but will instead be phased out on a gradual basis. I trust this clarifies the position for the Deputy at this time.

Gabhaim buíochas leis an Aire. The PUP has been a vital support for people through the Covid pandemic. I recognise the work of staff in the Department in processing the payment, which involved a huge effort. This vital support will need to be maintained because people will continue to rely on it in the weeks and months ahead. Given that we are now approaching the end of May, it is very important to have clarity for workers and families regarding this vital source of income. The Economic and Social Research Institute, ESRI, stated yesterday that a review of the scheme should be carried out in the autumn. The plan initially was that, from April this year, people on the PUP would be moved onto a jobseeker's payment. Will the Minister indicate whether that is still the plan and give her thoughts on that possible move?

I thank the Deputy for her comments regarding the efforts of staff in social protection offices the length and breadth of the country. They have done magnificent work. We sometimes take things for granted when they run smoothly and payments are there every week, but there is a lot of work that goes on behind the scenes every day to make sure that happens.

The PUP continues to be available at its current rates and the scheme remains open for applications until the end of June. The Government will set out the future of the PUP in the coming weeks. I hope to be in a position to do so at the start of June. We will have a better sense by then of how things are going in terms of the vaccine roll-out, the number of new cases and the trajectory of the virus. We will also have a clearer picture in respect of the numbers returning to work. We have been very clear that there will be no cliff edge in terms of the payments.

I reiterate that if the plan is as it was in April and it comes to pass that when the Minister says there will be no cliff edge it would be a move onto the jobseeker's payment of €203, the Minister must recognise that that is a much lower payment for many people. In addition, we know already that of the more than 19,000 people aged 18 to 24 who are in receipt of jobseeker's allowance, nearly 15,000 are on the reduced rate of €112.70 a week. That has to be taken into account.

I hope the Minister will also be able to address the issue of those who did not qualify or who were moved off the PUP and onto jobseeker's benefit and who are now running out of PRSI contributions in order to keep that jobseeker's benefit where their jobs are still not there to return to. Can there be any concession, leeway or flexibility for those people who do not have a job due to the public health restrictions and whose PRSI contributions are running out in respect of jobseeker's benefit?

Those who are on the PUP continue to be on it and, as I said, it remains open to new entrants until the end of June. Recipients know that if they are on the PUP, they will continue on that payment. The Government has not been found wanting in supporting people during this pandemic. Over €7.6 billion has been spent on the PUP to date, over 23 million individual payments have been issued, more than 850,000 people have received support under the scheme, and staff in my Department have answered over 10 million phone calls in the past year. I am discussing the future of the PUP with my Government colleagues and we hope to be in a position to make an announcement in that regard in early June. The Government has not been and will not be found wanting.

Employment Support Services

Questions (70)

Carol Nolan

Question:

70. Deputy Carol Nolan asked the Minister for Social Protection if she plans to continue using the services provided by Turas Nua and Seetec for the operation of the JobPath scheme; if she will consider alternative service providers; and if she will make a statement on the matter. [26483/21]

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Oral answers (7 contributions) (Question to Social)

Does the Minister plan to continue using the services provided by Turas Nua and Seetec for the operation of the JobPath scheme? Will she consider using alternative service providers? Will she make a statement on this matter?

I thank Deputy Nolan for raising this issue.

JobPath provides employment assistance and advice to the long-term unemployed on behalf of my Department. The current JobPath contracts were due to expire at the end of last year. Last October, however, in addition to contract renewals to the local employment services, job clubs and EmployAbility, I announced an extension of referrals to the JobPath service for a further 12 months until the end of 2021. While new referrals will cease at the end of December, there will be a run-off period to enable existing clients to complete their engagement with the service. These measures were taken in order to ensure that the public employment service had sufficient capacity to support those impacted by the pandemic with access to employment services throughout 2021.

In light of these circumstances, I deemed it prudent not only to retain but to expand the existing capacity of our public employment services. We will expand the footprint of local employment-type services into several new geographical areas where a local employment service does not currently exist. We are also expanding the capacity of Intreo centres to provide employment services and supports, with the assignment of an additional 100 job coaches this year. As the current contracts for all contracted employment services, including JobPath, expire at the end of 2021, my Department is currently developing requests for tender to ensure that high-quality employment services, with sufficient capacity to support all those who need our assistance in securing employment, are openly procured in a manner that is compatible with EU and national procurement rules.

I thank the Minister for her response and her clarity in confirming that the JobPath scheme will be extended. However, I draw her attention to the fact that there are more problems than solutions with JobPath. One big problem many people have with it is whether it represents value for money. We can say for certain that the total amount paid to Turas Nua and Seetec for the operation of the JobPath scheme for the period 2015 to date is €247.9 million. How can we honestly say that that represents value for money? Have any assessments been carried out in this regard? Have any comparisons been made with other jurisdictions? I know this is used in the UK but I am referring to jurisdictions apart from the UK and what they are doing to achieve value for money. I am concerned. The breakdown for every year is as follows. In 2015, €1.2 million-----

We will come back to you, Deputy. You are out of time.

To be clear, JobPath is not a job placement service. The providers are contracted to provide employment assistance and to support jobseekers. It is important to say that a review of JobPath has been carried out and that the OECD evaluation, which is completely independent, showed that, overall, those who participate on JobPath have better employment outcomes and earnings than those who are not supported by JobPath. Customer satisfaction is independently assessed by regular surveys and remains high. The number of complaints is low. I think it amounts to about 1% of more than 280,000 participants. If Deputies have examples of concern, I ask them to bring those specific cases to my attention and I will have them looked at. I am happy to make improvements.

When I asked about the value for money assessment, I was not talking about a review of how people were placed and so forth. I have questions about that too because many constituents in my office have made complaints. I have showed them how to do so through the formal process. That was a number of years ago and it is going on still. My question is whether the review looked at the money that is being spent because to me it seems colossal. The breakdown for each year is as follows: in 2015, €1.2 million; in 2016, €25.2 million; in 2017, €57.4 million; in 2018, €71.7 million; in 2019, €58.6 million; and in 2020, €33.8 million. This is a staggering sum of money, particularly when one considers that Turas Nua in particular has been the subject of continuing criticism and controversy, unfortunately.

The figures the Deputy refers to relate to services provided to more than 295,000 jobseekers. As I said, their success rate in getting and keeping jobs is better than with some of the other services. Now is not the time to cut employment support services of any kind. We face record unemployment as a result of the pandemic. There are currently 363,000 people on the PUP and another 177,000 on the live register. There are a number of different approaches to this. There are the local employment services, JobPath and the Intreo offices. As we face challenges and as the restrictions are lifted and people get back to work, I believe there will be challenges for those who do not get their jobs back. We need to support them in every single way we can to help them find employment that is suited to them. As I said, now is not the time to reduce the service levels. We are expanding the local employment services into a number of new geographical areas.

Social Welfare Payments

Questions (71)

Claire Kerrane

Question:

71. Deputy Claire Kerrane asked the Minister for Social Protection if she will consider taking steps in the next budget to begin increasing core social welfare payments to meet the minimum essential standard of living to ensure that those relying on social welfare supports are protected from poverty; and if she will make a statement on the matter. [26487/21]

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Oral answers (6 contributions) (Question to Social)

Ahead of the budget, which is not too far away, I wish to ask the Minister about the core social welfare payments. Will she consider increasing them in budget 2022 to start the process of getting to the minimum essential standard of living, which is so important? Any social welfare system should at the very least protect those who rely on it from poverty.

The measures taken by this and previous Governments ensure that social welfare payment rates in Ireland are among the highest in Europe and considerably higher than in the UK. Social transfers contribute very significantly to reducing poverty rates in Ireland.

According to the Central Statistics Office, in the absence of social transfers and pension income, the at-risk-of-poverty rate would be 41.4%. After social transfers, the rate is 12.8%. This is a poverty reduction effect of 68.5% for all social transfers and pensions, one of the highest in Europe.

The most recent data from the CSO's income and living conditions survey show poverty rates are falling and Ireland is one of the very few countries where the overall level of income is increasing and where income inequality is also falling.

Notwithstanding this progress, we should all acknowledge more can always be done, but what we do must be informed by the evidence. Towards this end, the Department funds a large body of research, including the work of the Vincentian Partnership, to develop and calculate the minimum essential standard of living. My officials work closely with Sr. Bernadette and her team and I find this work very useful in informing policy. The outputs from this research complement data produced from other analyses such as the survey on income and living conditions produced by the Central Statistics Office.

The Vincentian Partnership research provides an estimate of the income requirements of different family types in both urban and rural locations. It provides a comparison of welfare payments against these calculated requirements to identify what the Vincentian Partnership terms adequacy gaps. In 2020, the study concluded that pensioner couple households have no adequacy gaps but other households demonstrate gaps of various magnitudes.

The work of the Vincentian Partnership also highlights issues that may also be addressed with improvements in services. In this regard, improved services, such as the extension of GP-visit cards for children and the affordable childcare scheme, can result in significant reductions in the minimum income standards needed by households.

While the minimum essential standard of living is met by the State pension in certain circumstances, that is just one tiny cohort of people when we consider the range of social welfare supports provided. I acknowledge that social welfare rates play a role in lifting and keeping people out of poverty. However, many of today's rates are set below the poverty line and are nowhere near the minimum essential standard of living.

The Minister spoke about evidence, but there is no evidence used in the debate we have every year about a fiver for this group, a fiver for that group and nothing for the other group. It is not evidence-based and that is the problem. Therefore, we have this political football ahead of the budget every year and people are left with no certainty. That is why we need the core social welfare rates to be set against that minimum essential standard of living for evidence. I accept we have some of the highest social welfare rates in Europe, but we also have one of the highest cost of living rates in Europe.

In last year's budget, my priority was to target resources at the most vulnerable, which was why we increased the qualified child payments, the living alone allowance and the fuel allowance as well as making changes to the one-parent family payment. I also extended the hot school meals programme to an additional 35,000 children with 189 new schools benefiting. This year's budget will be framed as we continue, we hope, to emerge from the pandemic.

The total expenditure on all Covid supports to date is more than €28 billion. Because of the sound economic decisions made by the previous Government, we were able to pump money into the economy during the pandemic. During the financial crisis, we needed to take the money out and it has been the opposite this time around, but that is also borrowed money and ultimately we will need to pay it back.

The survey on income and living, SILC, data for 2019 are the latest data available on poverty. The Minister did not mention that deprivation increased in 2019, which is alarming given that was all pre-Covid. I appreciate the previous budget contained targeted measures, but we need to start looking at core social welfare rates that have not moved in the past two budgets.

A few weeks ago, representatives from Society of St. Vincent de Paul appeared before the social protection committee. They raised the issue of the increase in food poverty. They have received a 20% increase in calls for help for families. That increase in food poverty is of serious concern. This will be more of an issue as we emerge from the pandemic. I have not heard the Minister say she wants to start to align social welfare rates with the minimum essential standard of living, rather than increasing by a fiver and this political football. It is not evidence based and it is not good enough.

I will certainly be making the case to my colleagues in government for increased expenditure on social protection so that we can build on the progress we made last year. We will face several competing demands, but I will certainly make the case. The Deputy will appreciate it is only May and I cannot give her commitments on what will be in the budget at this stage. However, the good work carried out by the Vincentian Partnership will be central again this year when making our decisions.

The ESRI report, published last week, also shows we are making progress. It found that income inequality is at its lowest recorded level. In fact, that report stated Ireland is one of the few European countries to have experienced broad-based growth over the past three decades. Disposable incomes rose by more for lower income people than for higher income people, leading to big declines in income inequality between 1987 and 2019.