Dáil Éireann Debate, Thursday - 14 July 2022
98. Deputy Éamon Ó Cuív asked the Minister for Social Protection the reasoning behind the method of assessing capital under the various means tested schemes; if she intends on reforming this to ensure a more equitable system of assessment; and if she will make a statement on the matter. [38517/22]
View answerApplicants for social assistance payments are means-tested. A means test is a way of checking if a claimant has enough financial resources to support themselves and determine what amount of social assistance payment, if any, they may qualify for.
A maximum rate is payable where a person has limited or no means, and tapering applies to the rate payable to those with modest or more substantial means. This is because there is an expectation that those with resources can at least partly contribute towards supporting themselves.
Social welfare legislation provides that, for social assistance schemes, income and capital (such as savings, investments and property other than the family home) belonging to the claimant and his or her partner, where applicable, is assessable for means assessment purposes.
How capital is assessed can vary depending on the nature and purpose of the payment, and various disregards apply across the schemes, reducing the amount of means assessed.
For most social assistance schemes, the first €20,000 of capital is fully disregarded, the next €10,000 assessed at €1 per thousand, the next €10,000 assessed at €2 per thousand, with the remainder assessed at €4 per thousand.
For Disability Allowance and Carer’s Allowance, the first €50,000 of capital is fully disregarded. The Disability Allowance capital disregard was increased to €50,000 in 2007 in recognition of the fact that a person who is in receipt of Disability Allowance may not have had the opportunity to accumulate savings through participation in employment and that, in some circumstances, families may wish to make future financial provision for a child or sibling but are concerned that such provision would adversely affect their entitlement to Disability Allowance.
I increased the Carer’s Allowance disregard in Budget 2022 for similar reasons; family carers may decide to provide for the future care of children or adults with disabilities. Increasing the disregard in line with Disability Allowance allows for the planning of future care needs.
Any changes to the capital disregards would have cost implications and would have to be considered in the overall policy and budgetary context.
